A conflict of interest is generally understood as "a conflict between the private interests and the official responsibilities of a person in a position of trust."[1] Within financial assistance, both real and perceived conflicts must be properly mitigated.
This information applies to:
All discretionary programs
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Overview
Non-Federal entities who apply for and/or receive Federal financial assistance awards are required to "establish safeguards to prohibit employees from using their positions for a purpose that constitutes or presents the appearance of personal or organizational conflict of interest, or personal gain." [1]
During the application process, non-Federal entities are required to disclose to the Federal awarding agency (or pass-through entity) in writing any potential conflicts of interest in relation to those awards, in accordance with the established policies of the Federal agency (or pass-through entity). This may be necessary throughout the award's lifecycle, depending on when the situation in question occurs or is discovered. Failure by the non-Federal entity to disclose conflicts or interest could result in termination of the award
The U.S. Fish and Wildlife Service (FWS) provides its applicants and recipients with possible conflict of interest situations to consider when applying for and receiving FWS awards. Broadly, applicants (and recipients) need to address any relationship or matter which might put them, their employees, or their subrecipients in conflict with their responsibilities under the award and outside interests.
Non-Federal entities should consult their HR regarding their organization's conflict of interest policies.
Authorities
2 CFR 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards
§200.112 Conflict of interest.
The Federal awarding agency must establish conflict of interest policies for Federal awards. The non-Federal entity must disclose in writing any potential conflict of interest to the Federal awarding agency or pass-through entity in accordance with applicable Federal awarding agency policy.
[80 FR 43308, July 22, 2015]
2 CFR 200 Compliance Supplement (Frequently Asked Questions—July 2017 update)
200.112
.112-1 Conflict of Interest
Q: Section 200.112 states “The Federal awarding agency must establish conflict of interest policies for Federal awards. The non-Federal entity must disclose in writing any potential conflict of interest to the Federal awarding agency or pass-through entity in accordance with applicable Federal awarding agency policy.” Does this policy refer to scientific conflicts of interest that might arise in the research community?
A: No, however Federal agencies may have special policies or regulations specific to scientific conflicts of interest, such as HHS's policy at 42 CFR Part 50. The conflict of interest policy in 2 CFR 200.112 refers to conflicts that might arise around how a non-Federal entity expends funds under a Federal award. These types of decisions include, for example, selection of a subrecipient or procurements as described in section 200.318.
.112-2 Conflict of Interest – Scientific Collaborations
Q: Section 200.112 states “The Federal awarding agency must establish conflict of interest policies for Federal awards. The non-Federal entity must disclose in writing any potential conflict of interest to the Federal awarding agency or pass-through entity in accordance with applicable Federal awarding agency policy.”
A: FAQ 112-1 confirmed that this requirement does not refer to scientific conflicts of interest that may apply to projects supporting research. Scientific collaborations on research and development projects are generally the result of close collaboration prior to the submission of applications for support. Accordingly, virtually all of these collaborations might be considered to include a potential conflict of interest. The potential conflict is mitigated by the disclosure of these collaborations pursuant to agency requirements.
Q: Does Section 200.112 apply when a pass-through entity awards a subaward to support scientific collaboration on a research and development project?
A: Yes. When a subaward for scientific collaboration on a research and development project is included in the application for assistance or requested for prior approval and approved by the Federal awarding agency, the disclosure of any potential nonscientific conflict of interest, if required by the Federal awarding agency, provides sufficient information to the Federal awarding agency for the purpose of compliance with section 200.112.
For more information on the 2 CFR 200 faqs, click here.
U.S. Fish and Wildlife Guidance
Notice of Funding Opportunity template
Frequently Asked Questions
What is the purpose of this section of the Uniform Guidance?
The purpose of this section and much of the Uniform Guidance is to help to improve Federal awards performance and outcomes, in addition to ensuring the financial integrity of taxpayer funds in partnership with non-Federal stakeholders.
Does the Department of Interior have a conflict of interest policy for its employees?
Yes, the Department of Interior adopted a conflict of interest policy (DOI-AAAP-0008) on December 22, 2014.
What does the Department of Interior policy say concerning those employees who evaluate applications for Federal financial assistance?
The policy says that upon receipt of a memorandum of appointment, each proposal evaluator and/or advisor shall sign and return the Conflict of Interest Certificate to the Grants Officer. If an actual or potential conflict of interest exists, the appointee shall not be allowed to evaluate or provide advice on a potential applicant's proposal or provide advice on a potential applicant's proposal until the conflict of interest has been resolved with the servicing Ethics Counselor.
What if an evaluator signs the Conflict of Interest Certificate and then later becomes aware of a potential conflict of interest during the review process?
The Department of Interior policy clearly states that evaluators and advisors must immediately disclose in writing to the Grants Officer as soon as it becomes known that an actual or potential conflict of interest exists. The Grants Officer must then obtain the assistance of the servicing Ethics Counselor in order to reach an opinion or resolution and a record of this must be included in the official award file.
Where are the signed Conflict of Interest Certificates housed?
All signed certificates from the proposal evaluators and advisors must be retained in the master files for the Funding Opportunity Announcement.
What are some examples of situations that may represent a potential or actual conflict of interest?
Some potential conflict of interest situations include: (1) financial interest, including ownership in stocks and bonds, in a firm which submits or is expecting to submit an application; (2) outstanding financial commitments to any applicant or potential applicant; (3) employment in any capacity, even if otherwise permissible, by any applicant or potential applicant; (4) employment within the last 12 months by any applicant or potential applicant; (5) any vested pension or reemployment rights, or interest in profit sharing or stock bonus plans; (6) employment of any member of the immediate family by any applicant or potential applicant; (7) positions of trust that may include employment, past or present, as an officer, director, trustee, agent, attorney, ect; (8) a close personal relations that may include a childhood or other friend, sibling, or other family relations that may compromise or impair the fairness and impartiality of the proposal evaluator or advisor and grants officer during the proposal evaluation and award selection process; (9) negotiation of outside employment with any applicant or potential applicant.
What is the financial assistance recipients role in complying with 2 CFR 200.112?
The 2 CFR 200 requires all non-Federal entities to disclose in writing any potential conflict of interest to the Federal awarding agency or pass-through entity in accordance with the applicable Federal awarding agency policy.
As a recipient of financial assistance awards, how do I become aware of the Department of Interior's conflict of interest policy?
All Department of Interior financial assistance awards will include a term and condition that prohibits the recipient, employees of the recipient, and subrecipients conflict of interest. Recipients should review this term and condition in the notice of award concerning the Department of Interior's conflict of interest policy.
Learning Aids
Related Pages
Mandatory Disclosures (2 CFR 200.113) - NEED TO DEVELOP THIS PAGE AND CREATE A LINK TO IT.
Resources
U.S. Fish and Wildlife Service Ethics Program
DOI-AAAP-0008_Conflict of Interest Policy.pdf
DOI_Conflict of Interest Certificate.pdf
References
1. "Conflict of Interest." Merriam-Webster.com. Merriam-Webster, n.d. Web. 29 Dec. 2017.
2. “5 CFR 2635.501 - Overview.” LII / Legal Information Institute, www.law.cornell.edu/cfr/text/5/2635.501.
3. Scope, DOI AAAP 0008
