(a) In general

Chapter 13 of title 5, United States Code, is amended by adding after subchapter III the following:

IV Restrictions Regarding Financial Instruments

13151. Definitions

In this subchapter:

(1) Covered financial instrument

(A) In general

The term covered financial instrument means—

(i)

any investment in—

(I)

a security (as defined in section 3(a) of Securities Exchange Act of 1934 (15 U.S.C. 78c(a)));

(II)

a security future (as defined in that section); or

(III)

a commodity (as defined in section 1a of the Commodity Exchange Act (7 U.S.C. 1a)); and

(ii)

any economic interest comparable to an interest described in clause (i) that is acquired through synthetic means, such as the use of a derivative, including an option, warrant, or other similar means.

(B) Exclusions

The term covered financial instrument does not include—

(i)

a diversified mutual fund;

(ii)

a diversified exchange-traded fund;

(iii)

a United States Treasury bill, note, or bond; or

(iv)

compensation from the primary occupation of a spouse or dependent child of a senior Federal employee.

(2) Qualified blind trust

The term qualified blind trust has the meaning given the term in section 13104.

(3) Senior Federal employee

The term senior Federal employee means any individual occupying a Senior Executive Service position (as that term is defined in section 3132).

(4) Supervising ethics office

The term supervising ethics office has the meaning given the term in section 13101.

13152. Prohibition on certain transactions and holdings involving covered financial instruments

(a) Prohibition

Except as provided in subsection (b), a senior Federal employee, their spouse, or their dependent children may not, during the term of service of the employee, hold, purchase, or sell any covered financial instrument.

(b) Exceptions

The prohibition under subsection (a) does not apply to—

(1)

a sale by a senior Federal employee, their spouse, or their dependent child that is completed by the date that is—

(A)

for an employee serving on the date of enactment of this title, 180 days after that date of enactment; and

(B)

for any employee who commences service as an employee after the date of enactment of this title, 180 days after the first date of the initial term of service;

(2)

a covered financial instrument held in a qualified blind trust operated on behalf of, or for the benefit of, a senior Federal employee, their spouse, or their dependent child; or

(3)

a covered financial instrument exempted from coverage under section 208 of title 18 pursuant to section 2640.202 of title 5, Code of Federal Regulations (or any successor regulation).

(c) Application of certificate of divestiture program

For purposes of section 1043 of the Internal Revenue Code of 1986—

(1)

this section shall be treated as a Federal conflict of interest statute; and

(2)

any person required to dispose of any property by reason of this section shall be treated as an eligible person.

(d) Penalties

(1) Disgorgement

A senior Federal employee, their spouse, or their dependent child shall disgorge to the general fund of the Treasury any profit from a transaction or holding involving a covered financial instrument that is conducted in violation of this section.

(2) Income tax

A loss from a transaction or holding involving a covered financial instrument that is conducted in violation of this section may not be deducted from the amount of income tax owed by the applicable senior Federal employee, their spouse, or their dependent child.

(3) Fines

A senior Federal employee who holds or conducts a transaction involving a covered financial instrument in violation of this section may be subject to a civil fine assessed by the supervising ethics office under section 13153.

13153. Certification of compliance

(a) In general

Not less frequently than annually, each senior Federal employee shall submit to the supervising ethics office a written certification that the employee, their spouse, or their dependent child has achieved compliance with the requirements of this title.

(b) Publication

The supervising ethics office shall publish each certification submitted under subsection (a) on a publicly available website.

13154. Authority of supervising ethics office

(a) In general

The supervising ethics office may implement and enforce the requirements of this subchapter, including by—

(1)

issuing—

(A)

for applicable senior Federal employees—

(i)

rules governing that implementation; and

(ii)

1 or more reasonable extensions to achieve compliance with this subchapter, if the supervising ethics office determines that an employee is making a good faith effort to divest any covered financial instruments; and

(B)

guidance relating to covered financial instruments;

(2)

publishing on the internet certifications submitted by senior Federal employees under section 13153(a); and

(3)

assessing civil fines against any senior Federal employee who is in violation of this subchapter, subject to subsection (b).

(b) Requirements for civil fines

(1) Amount

A fine imposed under this section against a senior Federal employee shall be equal to the greater of—

(A)

$1,000, or

(B)

an amount equal to 10 percent of the greatest dollar value of the applicable covered financial instrument during any period that such instrument was held by the applicable senior Federal employee or their spouse or dependent child (as the case may be).

(2) In general

Before imposing a fine pursuant to this section, the supervising ethics office shall provide to the applicable senior Federal employee—

(A)

a written notice describing each covered financial instrument transaction for which a fine will be assessed; and

(B)

an opportunity, with respect to each such covered financial instrument transaction—

(i)

for a hearing; and

(ii)

to achieve compliance with the requirements of this subchapter.

(3) Publication

The supervising ethics office shall publish on a publicly available website a description of—

(A)

each fine assessed pursuant to this section;

(B)

the reasons why each such fine was assessed; and

(C)

the result of each assessment, including any hearing under paragraph (2)(B)(i) relating to the assessment.

(4) Appeal

A senior Federal employee may appeal to the supervising ethics office a fine assessed under this section during the 30-day period beginning on the date the fine is so assessed.

13155. Audit by Government Accountability Office

Not later than 2 years after the date of enactment of this subchapter, the Comptroller General of the United States shall—

(1)

conduct an audit of the compliance by senior Federal employees with the requirements of this subchapter; and

(2)

submit to each supervising ethics office a report describing the results of the audit conducted under paragraph (1).

(b) Application

The amendments made by subsection (a) shall apply to individuals described in section 13152(a) of title 5, United States Code, (as added by subsection (a)) beginning on the date that is 12 months following the date of enactment of this Act.

(c) Additional employees

Section 13121(c)(1) of title 5, United States Code, is amended by inserting up to 100 after appoint.

(d) Funding

The Director of the Office of Management and Budget may transfer such funds as the Director considers appropriate, to be derived from unobligated amounts available for executive branch programs identified by the Director to be duplicative, to the Office of Government Ethics for the purpose of carrying out this Act, to remain available until the date that is 5 years following the date of the enactment of this Act.