Official's Stock Options In and Deferred Salary From a Corporation as a "Financial Interest" of an Executive Branch Official in Such Corporation

Publication Date: September 2003

Publisher: Library of Congress. Congressional Research Service


Research Area: Business



This memorandum responds to your request, as discussed with Dan Katz of your staff, for a discussion of whether or not the holding of unexercised stock options in a private corporation, and the receipt of “deferred salary” from that corporation, by an official in the executive branch of the United States Government, would generally be considered a “financial interest” of that official in that private corporation for conflict of interest and ethics purposes under federal law and regulation. You have inquired as to whether or not assigning to charities all after-tax profits from any exercise of the stock options in the corporation, and independently insuring the salary payments from the corporation, would change the conclusion as to the official’s “financial interest” in the corporation in question.