What This Bill Does
This bill amends PROMESA (a federal law about government oversight) to add ethics rules for advisors working with the Financial Oversight and Management Board. The bill prevents certain consulting firms from advising the board if those same firms are also working for companies competing to win or already performing government contracts.
Who It Affects
Third-party advisory firms and consulting companies that work with the Financial Oversight and Management Board. Officers and employees of those firms. The territorial government and its related organizations. The Attorney General and United States Attorney for the covered territory.
Key Provisions
A third-party advisory or consulting firm cannot advise the Oversight Board if the firm is also working for any individual, company or business entity that is competing for or performing a covered contract (a contract with the territorial government that the Oversight Board has jurisdiction over). (Sec. 109(c)(2))
Consulting firms must certify in writing to the Oversight Board that they are not disqualified under the conflict-of-interest rules before they can advise the board about reviewing, obtaining or performing covered contracts. (Sec. 109(c)(3)(A))
Officers or employees who intentionally provide false or misleading information in their certification must be prosecuted. Anyone who learns their information is false must immediately tell the Oversight Board in writing or face legal penalties. (Sec. 109(c)(3)(B))
If the Oversight Board discovers a consulting firm violated these rules, the board must immediately refer the matter to the Attorney General and United States Attorney for the territory. (Sec. 109(c)(3)(C))
What Changes
The Oversight Board gains authority to disqualify consulting and advisory firms that have conflicts of interest with territorial government contracts. The board must create specific rules about how firms prove they have no conflicts. The board must investigate potential violations and report violations to legal authorities.
Important Definitions
Covered contract: a contract with the territorial government or its agencies where the Oversight Board has jurisdiction over the work being performed. (Sec. 109(c)(1))
Effective Date
Not specified in bill text
I
118TH CONGRESS
1ST SESSION H. R. 1702
To amend PROMESA to include certain ethics provisions to provide for
the disqualification of certain advisors to the Financial Oversight and
Management Board, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 22, 2023
Mrs. GONZA´LEZ-COLO´N (for herself, Mr. TORRES of New York, and Mr.
SOTO) introduced the following bill; which was referred to the Committee
on Natural Resources
A BILL
To amend PROMESA to include certain ethics provisions
to provide for the disqualification of certain advisors
to the Financial Oversight and Management Board, and
for other purposes.
Be it enacted by the Senate and House of Representa-
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tives of the United States of America in Congress assembled,
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SECTION 1. DISQUALIFICATION OF CERTAIN ADVISORS TO
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THE FINANCIAL OVERSIGHT AND MANAGE-
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MENT BOARD.
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Section 109 of PROMESA (48 U.S.C. 2129) is
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amended by adding at the end the following:
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‘‘(c) DISQUALIFICATION OF CERTAIN ADVISORS.—
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‘‘(1) DEFINITION OF COVERED CONTRACT.—In
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this subsection, the term ‘covered contract’ means a
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contract with the territorial government or an in-
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strumentality of the territorial government, the per-
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formance of which is within the jurisdiction of the
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Oversight Board under section 204(b).
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‘‘(2) DISQUALIFICATION.—In accordance with
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the rules adopted by the Oversight Board under
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paragraph (3), any third-party advisory or con-
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sulting firm shall be disqualified from advising the
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Oversight Board for the duration of any period dur-
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ing which the firm has as a client, or provides advi-
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sory or other consulting services in any capacity to,
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an individual, corporation, association, organization,
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or other business entity, including a subsidiary, that
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is competing for, or is performing, a covered con-
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tract.
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‘‘(3) RULES.—For purposes of carrying out
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paragraph (2), the Oversight Board shall adopt rules
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to carry out the following:
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‘‘(A) To be eligible to advise or consult the
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Oversight Board with respect to the review,
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procurement, or performance of a covered con-
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tract, a third-party advisory or consulting firm
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shall certify to the Oversight Board that the
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•HR 1702 IH
third-party advisory or consulting firm is not
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disqualified from advising the Oversight Board
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under paragraph (2).
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‘‘(B) Any officer or employee of a third-
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party advisory or consulting firm who prepares,
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presents, or certifies any information or report
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with respect to the certification of the third-
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party advisory or consulting firm under sub-
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paragraph (A) for the Oversight Board, or any
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agent of the Oversight Board, that is inten-
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tionally false or misleading, or, on learning that
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any such information is false or misleading,
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fails to immediately advise the Oversight Board
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or an agent of the Oversight Board in writing,
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shall be subject to prosecution and penalties
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under law.
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‘‘(C) If, after an investigation conducted
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by the Oversight Board, the Oversight Board
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determines that a third-party advisory or con-
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sulting firm has provided services to the Over-
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sight Board in violation of paragraph (2), has
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failed to submit a certification required under
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subparagraph (A), or is in violation of subpara-
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graph (B) (including any rules adopted under
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subparagraph (A) or (B)), the Oversight Board
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•HR 1702 IH
shall immediately refer such information to the
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Attorney General for the covered territory and
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the Office of the United States Attorney for the
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covered territory.’’.
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Æ
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