PROPOSALS TO STRENGTHEN THE FOREIGN GIFTS AND DECORATIONS ACT OF 1966

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP05C01629R000701540004-7
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 76
• Document Creation Date: December 22, 2016
• Document Release Date: August 18, 2011
• Sequence Number: 4
• Publication Date: March 26, 1975
• Content Type: REPORT

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REPORT TO THE COMMITTEE ON
FOREIGN RELATIONS
UNITED STATES SENATE
Proposals To Strengthen
The Foreign Gifts And Decorations
Act Of 1966
Multiagency
BY THE COMPTROLLER GENERAL
OF THE UNITED STA TES
MARCH 26,1975
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COMPTROLLER GENERAL OF THE UNITED STATES
WASHINGTON. D.C. Z05N
The Honorable John J. Sparkman
Chairman, Committee on Foreign
Relations
United States Senate
This report is in response to your April 11, 1974, request
that we examine the administration and operation of the For-
eign Gifts and Decorations Act of 1966 and subsequent legis-
lation, Executive orders, and regulations.
The report contains recommendations tc the Congress for
legislative changes and to the Secretary of State to improve
the administration of current provisions of the act. In
addition, we anticipate wide public interest in the matters
discussed in the report. Therefore, as arranged with your
office we are distributing the report to other committees
and Members of Congress, to the Department of State, and to
other interested parties.
Sincerely yours,
'01 /1
rz.. tl-I,*. /g~i4
Comptroller General
of the United States
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C o n t e n t s
Page
DIGEST
CHAPTER
1
GIFTS AND DECORATIONS LEGISLATION
Foreign Gifts and Decorations Act of
1
1966
1
Regulations implementing the act
1
2
REPORTING OF GIFTS
4
Gifts reported to the Chief of Protocol
4
Presidential gifts not reported
5
Presidential gift procedures
6
Disposition of Presidential gifts
Gift reporting by Vice Presidents and
7
Secretaries of State
8
Executive agency reporting requirements
8
Congressional policies and procedures
10
Judiciary policies ant; procedures
11
Conclusions
12
Recommendations
12
Agency comments and our evaluation
12
3
ADMINISTRATION OF THE ACT
15
Need fo:; clarification of the act
Actions the Office of Protocol could
15
have taken
Government employees' notification on
17
provisions of the law
Confusion on types of gifts required
19
to be reported
Acceptance of trips or travel at the
2U
expense of foreign gaovernments
21
C J n c 1 u3 i vi1S
22
Recommendations
23
Ac:lncy comments and our evaluation
Mutters for consi::eration by the
23
Congress
24
4
QUESTIONABLE DISPOSITION AND USE OF GIFTS
29
Disposition of gifts
29
Lack of control over official-use
items
31
Conclusions and recommendations
32
Agency comments and our evaluation
31.
5
DECORATIONS
33
Administrative burden
33
Conclusions and recommendations
34
Agency comments
35
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CHAPTER
6 SCOPE OF REV-EW
APPENDIX
I Request for the review
II State Department memorandum on employee re-
Pate
sponsibilities under the Act 38
III President Ford's new procedures for process-
irq foreign gifts received by the Presi-
de.ft and First Family
VI Principal Officials of Department of State
responsible for administering activities
discussed in this report
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COMPTROLLER GENERAL'S REPOi,r TO
THE COMMITTEE ON FOREIGN
RELATIONS
UNITED STATES SENATE
PROPOSALS TO STRENGTHEN THE
FOREIGN GIFTS AND DECORATIONS
ACT OF 1966
Multiagency
D I G E S T
WHY THE REVIEW WAS MADE
The Senate Committee on Foreign
Relations asked GAO to review
administration and operation of
the Foreign Gifts and Decora-
tions Act of 1966 and subse-
quent legislation, Executive
orders, and regulations. (See
P. 37.)
The Chief of Protocol, Depart-
ment of State is responsible
for administering the act.
(See p. 2.)
FINDINGS AND CONCLUSIONS
Deficiencies in the act and its
implementing regulations limit
the effectiveness of the law.
Gifts and decorations
Teri Tation
Implementing provisions of the
Constitution (see p. 1), the
1966 Act
Acceptance of unsolicited gifts
and decorations is permissible
if their refusal might offend
or embarrass the donor or ad-
versely affect the foreign re-
lations of the United States.
(See p. 1.)
The act permits acceptance and
retention of gifts of minimal
value and decorations for out-
standing or meritorious serv-
ice. All other gifts and deco-
rations may not be retained and
are the property of the United
States. (See p. 1.)
Reporting of gifts
The act applies to Presidents,
Vice Presidents, Members of the
Congress and employees in all
three branches of Federal
Government, including civilian
and military. It does not ap-
ply to sortie experts and con-
sultants hired by the Govern-
ment. (See p. 4.)
--prohibits Government employ-
ees from soliciting gifts and
decorations, and
---discourages acceptance of un-
solicited gifts from other
governments by limiting con-
ditions under which gifts may
be accepted. (See p. 1.)
IMJrf Sheet. Upon removal, the report
cover date should be noted hereon. 1
The President, Vice President,
and Secretary of State and
members of their families are
the principal recipients of
gifts from foreign governments.
(See p. 4.)
As of September 1, 1974, 542
foreign gifts were reported by
141 employees of the executive
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and legislative branches to the
Office of Protocol. (See
p. 4.)
This total does not include a
large number of gifts received
by Presidents Johnson or Nixon.
Neither had reported to Pro-
tocol the gifts recorded by
their Gift Units. (See
p. 4.)
President Johnson's gifts are
in the LBJ Library in Austin,
Texas. Most of President
Nixon's gifts are in storage at
the National Archives. (See
pp. 7 and 8.)
Gifts received by the Presi-
dents are handled exclusively
by a White House Gift Unit.
The White House Gift Unit did
not identify all gifts received
by former President Nixon and
members of his family. (See
PP. 5 to 7.)
President Ford has approved new
procedures relating to the ac-
ceptance of foreign gifts re-
ceived by him and his family.
GAO believes the new procedures
will improve reporting and con-
trolling these gifts under the
act. (See p. 7.)
As of March 1975, Vice Presi-
dent Rockefeller's staff and
the Department of State's
staff were developing new
procedures for handling gifts.
(See p. 13.)
Records GAO has examined indi-
cate that some Government of-
ficials may have received gifts
which, up to the present, have
not been reported to the Chief
of Protocol. GAO was unable to
ascertain whether these were
isolated instances or represen-
tative of a more general prob-
lem of a lack of reporting.
(See pp. 4, 8, and 10.)
Administration of the act
The reporting system under the
act relies heavily on voluntary
conplianze by the recipient.
Neither the act nor its regula-
tions require ..hat gifts be re-
ported within a specific time,
nor is there an effective
penalty for non%ompliance.
These deficiencies limit the
effectiveness of the law.
(See p. 15.)
However, the Chief of Protocol
could have
--alerted the Congress to dif-
ficulties encountered,
--requested the White House and
other Federal agencies or
units t) report gifts re-
ceived by their employees,
--advised gift recipients of
the provisions of the act,
and
--retained or prepared records
": gifts known to have been
received but not reported.
(See pp. 17 and 18.)
Individuals receiving g.f_ts
often are in the higher civil
service grades or hold elective
or high appoi-itee positions.
GAO noted a reluctance on the
part of the Office of Protocol
*o approach such individuals
concerning requirements of the
act. (See p. 18.)
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Here are other aspects of the
act and its regulations re-
quiring clarification or
change:
--Regulations do not explain
that the act applies to gifts
given by officials of any
foreign governmental subdivi-
sion, not solely national
governments. (See p. 20.)
--Regulations fail to explain
that all gifts whether given
as a personal or state gift,
are under the provisions of
the law. (See p. 20.)
--Neither the regulations nor
the act state whether or not
gifts from foreign qu;asi-
government organizations or
multinational orqanizations
need to be reported. (See
p. 16.)
Neither the act nor its regula-
tions require an independent
appraisal of the gifts. The
burden of determining a gift's
worth--"minimal value" defined
as $50 cr less--re::.ts with the
recipient. ;See p. 17.)
The at also applies to intan=
Bible gifts such as travel.
However, as a general rile,
intangible gifts of more than
minimal value may not be ac-
cepted. (See p. 21.)
Questionable disposition and
use off-
Once a gift is reported to the
C',ief of Protocol, he may per-
mit its use for off4cial pur-
poses or declare it excess per-
so,ial property and transfer it
to the General Services Admin-
istration for disposition.
The Chief of Protocol was un-
able to locate all gifts, in-
dicative of inadequate control.
(See pp. 29 and 31.)
Generally, the General Services
Administration advises suitable
Government units, such as
museums, that items are avail-
able. If there are no re-
quests, the items may he sold.
As of Septemr_-,r 1, 1974, 433
gifts had been turned over to
the General Services Adminis-
tration. Of these, 283 were
on hand and 143 were trans-
ferred, with the remaining 7
being sold by th. Administra-
tion.
One museum, to which gifts had
been transferred, had exchanged
or sold 26 items. Better con-
trol over dispositic..-- of gifts
is needed. (See pp. 29 to 31.)
Decorations
The provisions cf the act re-
garding decorations are genE-r-
ally being followed. (See
pp. 33 and 34.)
RECOMMENDATIONS
The Secretary of State snould
dev?lop clear procedures for
the recording, control, and
custody of gifts subject to
reporting under the 1966 act.
These procedures should in-
clude:
--Requesting that Federal agen-
cies acid U.S. missions report
to the Chief of Protocol
lsa~ Shc~!
iii
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Federal employees who re-
ceived decorations or gifts
beyond minimal value.
--Directing the Chief of Pro-
tocol to periodically dis-
close to th? public, gifts
reported to him; request an
accounting of gifts received
by the Vice President, the
White House staff, and Sec-
retary of State; and note
and document gifts retained
for official use, and gifts
not deposited but known to
have been received. (See
pp. 12 and 23.)
AGENCY ACTIONS AND UNRESOLVED
ISSUES
In disagreeing with GAO recom-
mendations, the Department of
State
--was of the op i:, i on that it
could not have taken any ac-
tion which would have led to
broader compliance with the
act,
--said that actions which GAO
feels the Office of Protocol
could have taken, were not
taken due to the absence of
enforcement and compliance
authority, and
--indicated that the office of
Protocol's reticence to ad-
vise the Congress of diffi-
culties encountered in ad-
miriister ing the act stemmed
from Protocol's inability to
effect compliance in a gen-
eral way, rathe: than from
sensitivity toward gift
recipients. (See pp. 12,
13, 23, and 24.)
The act and its regulations
limit the State Department's
administrative. effectiveness.
However, actions GAO i,idicated
the Department could have taken
were prud-nt administrative
steps reaiily available.
In addition comments were re-
ceived from the Department of
Defense, Executive Office of
the President, General Services
Administration, and Smithsonian
Institution and are discussed,
where appropriate, in the re-
port.
MATTERS FOR CONSIDERATION
BY THE CONGRESS
GAO believes a need exists to
amend the Foreign Gifts and
Decorations Act to provide the
basis for adequately implement-
ing the constitutional intent
to control the impact of gifts
given by foreign governments.
Further, a need exists for each
branch of the Government to es-
tablish separate arrangements
to see that the statute is
followed. GAO believes it is
unreasonable to expect the Of-
fice of Protocol to he in a
position to effectively admin-
ister the act with respect to
the legislative and judicial
branches. GAO believes the act
should be amended to require
that
--separate entities be respon-
sible for administering the
act in each branch of the
Government,
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--gifts be reported and c?cpos-
ited within a specific period
of time from receipt,
--there be an effective penalty
for noncompliance with the
act,
--appropriate coverage .or
temporary or intermittent
experts and consultants '.,)c-
provided,
--permission be required from
the Secretary of State before
selling or trading a foreign
gift, and
---responsibility for defining
minimal value be given to the
President and be defined as a
specific dollar value not
subject to interpretation
(possibly $100 U.S. retail
price at the time of pur-
chase) with consideration be-
ing given by him from time to
time to making the value re-
flect inflation factors.
(See pp. 24 and 25.)
The act should fu: tner be
amended to
--require public disclosure and
independent appraisal of
gifts,
--clarify whether gifts from
quasi-governmental and multi.
national organizations are
included under the provisions
of the act,
--distinguish and provide for
hA a ceptur,ce of intangible
gifts and emoluments of more
-,.an :minimal value, such as
rravei, where the benefits
clearly accrue to the U.S.
Government as opposed to the
individual, and when approved
by an appropriate official cf
the executive, legislative,
and judicial branches.
--clarify whether the President
or his delegate is author. ized
to dispose of foreign gifts
:;;d decorations without con-
s ider i;,g res :r ict ions of
other statutes governing dis-
p^sai of U.S. property, and
--clarify if a gift from a
member of a foreign Head of
State's family is to bp con-
sidered a gift from a for-
eign government. (Sec
p. 25.)
When considering the amendment
and administration of the act,
Congress may wish to consider
alternative policy options in
the interest of perspective.
Four approaches are listed
below.
--Consenting to the acceptance
of gifts, where their refusal
would likely cause offense or
embarrassment or adversely
affect the foreign relations
of the Unite.; States, with
the recipient permitted to
retain those of minimal v-ilue
(current approach).
--Consenting to
the
recipient's
retention of
gifts
of minimal
value, where
their
:Pfusal
would likely
cause
offense or
embarrassmenc or adversely
affect the foreign relations
of the Unitee States, and
prohibiting the acceptance
of gifts above such value.
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--Consentinc, to ".z! re:~ini
ent's acceptanc.; a1d re-
tention of all gifts, where
their refusal would likely
cause offense or embarrass-
ment or adversely affect
the foreign relations of
the United States.
--Prohibiting the acceptance of
any gifts by veder al
ees. (See pp. 25 to 2,.)
GAO has drafted a revised st-at?-
aite, base? on the current Fl?-
proach ?nd the problems identi-
fied dur_n5 this review. (See
app. 1. )
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CHAPTER 1.
GIFTS AND LOCORA'"tON?. LEGISLATION
Article I, section 9, ctaas, 8, of the United States
Constitution provides:
"N(; Title of iobility shall to granted by the
Unit-ad States: And no Person holding any
Office of Frofit or Trust under them, shall,
without the Consent of the Congress, accent of
any present, Emolument, office, or Title, of
any i0.'-d whatevcr, fro.n any King.. Prince, or
foreign State."
The Constitution does not prohibit e~-cootance of
gifts or decorations under all circumsta. ?)s bit unly requires
he Congress3 to consent to their acceptan?:e.
FOREIGN GIFTS AND DECORATIONS
ACT OF 1966
Before c'.e October 15, 1966, enactment of the Foreign
Gifts and Decorations Act of 1966 (Public Law 99-673). the
Co,-.gress had received hundreds of requests for its consent
to retain vrric'us gifts and decorations. The Congress passed
the act, in part, to alleviate the legislative burden asso-
ciated wish the requests.
The act prohibits U.S. Government Employees from solicit-
ing gifts and decorations from foreign governments. It also
discourages the acceptance of unsolicited gifts and decora-
tions by limiting the c'nditions under which gifts may be
accepted.
In the act, the C,ngress consenter: to retaining gifts
c` minimal value and decorations received L.,r ot'tstandiny
and meritorious services. cceptance of rifts of more th~r.
minimal value iz permissible only if their refusal would
likely cause offen or embarrassment or would adversely af-
fect the Foreign relations of the United States. However,
gifts of more than minimal value and decorations ::o* received
for outstanding and meritorious service may not be rotaine-1.
They are the property of the Uni `ed States '_o be used or dir-
posed of as specified in regulations isst.ed by the ''rl-s!dent
to impler en* the act.
REGULATIONS IMPLFMMENTINC THE ACT
By ~xecuutive Order 11320, Decemb-r 12, 1966, the
President delegated his authority to the Secretary of State
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to prescribe regulations under the act. Pursuant to this
authority, the Secretary issued regulations (22 C.F.R.
cart 3) implementing the legislation. These regulations
restate the provisions of the act, detail :,necific administra-
tive responsibilities, and clarify certain provisions. More
specifically, they delegate responsibility to the Chief of
Protocol for administering the legislation and define "minimal
value" as not to exceed $50.
Under the regulations, any gifts or decc!.ations which
become the uroperty of the United States are to De forwarded
to the Chief of Protocol unless he approves their retention
for official use.
The Chief of Protocol, in turn, is to forward gifts and
decorations not permitted to be retained ror official use to
the General Services Administration (GSA). GSA transfers,
donates, or otherwise disposes of the sifts in accordance
with instructions issued by the Chief of Protocol or, in
absence of such instructions, in accordance with the provi-
sions of the Federal Property and Administrative Services
Act of 1949, as amended. (See ch. 4.)
While the act did not specifically define minimal value,
the Congress was aware that minimal value would :-)e established
by regulation as not exceeding $50. In a letter transmitting
the draft legislation and in testimony on the legislation, the
State Dep:.rtment had stated that minimal value would not exceed
$50. The $50 ceiling was not defined in the law to allow
on.e: executive agenc _s to prescribe a lower dollar ll,iita-
tion. The Deoartment of Defense, for example, has established
a $10 limit for personnel associated with the Military Assist-
ance Proaram. The act does not specifically state wt,ather the
ceilinu refers to wholesale or '.etail value and whether it re-
f afro to the ; ?l ?e at purchase or to the present replacement
-?3lue i.: the United States. GSA believes there should be a
revised definition addressing this issue.
By establishing a minimal value, the Congress intended to
allow recipients to accept and retain "small things, trivial
thina~, marks of courtesy a.id respect." We noted, however,
that the United States has exoerienced relatively high in-
flation durin the 8 years since tha $50 mirimai value was
established. In view of infl3tio-, the mirimGl value stated
in 1966 dollars has been reduced by 4(u percent to approxi-
'ate1v San. 4s a result, the current figure of $50 may he
outdated and 7av not adequately reflect the Congress' original
ourcose in e~actini a minimt.l value provision.
The Decartment of State has a different view. They be-
lir.Pe that inflation has actually helped to bring the
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regulation's $5 limit mole in keening with the spirit of the
legislative intent. We no;.e, however, that the Department
does not adhere to a $30 limit in their own gift-aivinq prac-
tice.
As discussed later in the report, GAO believes certain
chanqes are warranted in the act and implementing regulations
to strengthen their administration.
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CHAPTER 2
REPONTINL OF GIFTS
While tk.e art- prohibits Government employees from
soliciting gifts and discourages accepting unsolicited gifts
from foreign governments, it is customary for high-level
Government officials to participate in gift ceremonies when
receiving or visiting foreign dignitaries. Such ceremonies
are usually arranged in advance by the Department of State.
Ocza::ionally, valuable gifts are exchanged privately and
not At formal gift exchange ceremonies. Gifts given by heads
of foreign governments range from those of nominal value,
such as photographs, to items worth tens of thousands of
dollars, such as ancient national treasures.
The requirement for r.-porting foreign gifts to the Chief
of Protocol applies to Presidents, Vice Presidents, Members
of the Congress and employees in all three branches of Federal
Government, including civilian and military. The act does not
apply to certain experts and consultants hired by the Govern-
ment.
GI`TS REPORTED TO THE CHIEF OF PROTOCOL
From the passage of the 1966 act through September 1,
1974, 542 foreign gifts had been report-'d to the Chief of Pro-
tocol. As shown below these gifts were received and reported
by 141 employees.
Number
reporting
ifts
Number
of gifts
reported
Executive employees
134
519
Legislative employees
7
23
Judicial employees
-
-
Total
141
542
The President, Vice President, and Secretary of State are
the prime recipients of foreign gifts. Of the 542 foreign
gifts reported, 203 were received and reported by various Sec-
retaries of State or Vice Presidents. The figure does not
include a large numter of foreign gifts received by Presidents
and a number of gifts received by other Federal employees but
not yet reported and deposited with the Chief of Protocol.
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PRESIDENTIAL GIFTS NOT REPORTED
Gifts received by Presidents are handled exclus-vely by
a White House Gift Unit. We ha'-i been unable to find any ex-
plicit legal authority, such as an Executive order or requla-
tion, creatinq the Presidential Gift Unit or prescribing its
procedures. we have learned, however, that the Unit w?s es-
tablished before the oassage of the act *c' record and con-
trol qifts received by members of the first family and that
the Unit continued to perform this function after the act
was Passed in 1966. In March 1969 the Office of Protocol
and the White House discussed the need for coordinating
procedures, but the T.dtter was not pursued until late 1974.
Regulations issued pursuant to the act required that all
gifts from foreign governments be reported to the Chief of
Prctocol. Presidents Johnson and Nixor had received a large
number of gifts from foreign heads of state and recorded
them in their own Gift Unit. However, neither reported his
gifts to Protocol nor notified the Chief of Protocol of his
intention to retain thew for official purposes or to place
them in a Presidential library. As discussed laver, President
Ford in December 1974 issued new procedures, including require-
ments for reporting Presidential gifts to the Chief of Protocol.
While the practice of Presidents Johnson and Nixon of fail-
ing to report gifts to the Office of Protocct Jid iot conform
with established regulations, we have concl'ided that, assuming
they fully complied with other statutory and regulatory provi-
sions, they did not act illegally by using the special White
House Gift Unit rather than the Office of Protocol to record
and dispose of qifts.
As a general rule. the statutory regulations of
Covernment departments and administrative agencies have the
fors? and effect of law and are bindinq on Government of-
ficials as well as on the public. Occasionally, however,
courts have permitted Government agencies to depart from
their own regulations. In these cases, the courts have
focused on the purpose of the regulations, distinguishing
between regulations intended solely for "the orderly transac-
tion of bu.;iness" and regulations designed to protect the
legal rights and interests of a party.
Applyinq this principle to the regulation designating the
Office of Protocol as the agency responsible for recording and
disposing of gifts, it seems clear that the regulation was not
adopted to protect the rights or interests of a party. Rather,
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it applies more to proiotinq "the orderly transaction of
business." The regulation prescribes the procedures by which
the Government is 11-o Alisoose of gifts and decorations received
by Government officials and employees.
It be argued that the requlation was designed to
protect the legal interests of the Government since, under
the act, any Gift or decoration which may not be retained
becomes the property of the United States. However, other
provisions in the act and regulations specifying the gifts
and decorations that cannot oe retained serve to protect the
Government's prooertv interest in these items. We have con-
cluded, therefore, that the regulation merely prescribes in-
ternal Government procedures and that its principal purpose
is not to protect the interests of the Government or any
individual.
The Office of Protocol has expressed concern that. this
conclusion may encourage other recipients of foreign gifts
to believe that alternative modes of handling and disposing
of these gifts are permissible under the act. However, we
believe the position of the President is unique under the
Act and unique as the primary recipient of foreign gifts.
In the Foreign Gifts and Decorations Act, the Congress
explicitly named the President as the official responsible
for promuloatina regulations necessa.y to carry out the act.
Unlike others who may receive foreign gifts, the President
clearly has adenuate statutory authority to establish his
own gift unit for the administrative purposes of recording
and disposing of gifts. Moreover, because of the President's
paramount role i.-. conducting foreign affairs, he is a pri-
narv recipient of foreign gifts, and thus, establishing a
special unit exclusively for the purpose of recording and
disposinq of President4.al gifts is not unreasonable.
PRESIDENTIAL GIFT PROCEDURES
To identify the gifts that Pr-sidents Johnson and Nixon
received, and the controls o/er the gifts, we interviewed
White House Gift Unit personnel and reviewed the records that
had been prepared by that Unit. The Gift Unit did not have
any written procedures governing the handling, storing, or
rr,cordinq of gifts for Presidents Johnson and Nixon. However,
we received a briefing on their procedures.
Most gifts were processed through the White House mail-
room. Here, an original card and five copies were prepared
for each gift, listing the donor, date received, and a de-
scription of the gift. One card was attached to the gift,
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two cards were mair;tained in the mailroom files, and the
r::?-naininq three cards were forwarded to the White House
Gift Unit.
After an acknowledgement had been sent to the donor the
three cards would be filed by the Gift Unit. One card would
be used in a gift-by-gift index, one card in a donor index,
and the third card in a working file. If the gift is judged
to be unusual or of substantial value, a photo of it would
be taken. The gift would then be sent to the National Ar-
chives or placed on display with its location being recorded
in tht working card file.
On certain occ?asicns, gifts were given directly to
members of the first family and did not come into the custody
of the Gift Unit. However, Gift Unit personnel claimed they
were generally able to identify and record such gifts through
outgoing thank you letters.
We examined on a test basis the Gift Unit records main-
tained for Presidents Johnson and Nixon and their families.
We found that Preside:it Johnson's records were in order, but
a number of gifts apparently received by President Nixon and
members of the first family had not been recorded by the
Gift unit.
In audition to his Vice Presidential records and proce-
d;ires concerning foreign gifts, President Ford made avail-
able to GAO his new procedures for handling Presidential
gifts. These new procedures, finalized on December 13, 1974,
indicate a tightening of controls over gifts received by
the President and first family. Additionally, the procedures
orovide for periodic accounting by the Gift Unit to the Of-
fice of Protocol for gifts received and requires consent for
gifts used for official purposes. (See app. III.)
DISPOSITION OF PRESIDENTIAL GIFTS
While a President is in office, the gifts he receives
are generally stored at the National Archives--a Dart of GSA.
They are stored under the authority of 44 U.S.C. 2107 and
2l38 which relate to Presidential libraries. When a President
leaves office, it is customary to retain the gifts in a Fed-
eral depository until they can he transferred to a Presidential
library.
Accordinq to GSA officials, President Johnson's gifts,
regardless of value or whether they were received from a
foreigner or a U.S. citizen, are in the custody of -the LBJ
Library, a Federal depository in Austin, Texas.
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According to Gift Unit records, most of President Nixon's
gifts were in storaqe at the National Archives, Washington,
D.C., cr at San Clemente, California, at the time of our re-
view. The National Archives was providinq courtesy storage
for the gifts pending shipping instructions from Mr. Nixon.
Records relating to these gifts were in the possession of
the Chief of Protocol.
We inspected a selected number of gifts at the LB.'
Library and the National Archives to assure ourselves that
the gifts that were recorded on the White House Gift Unit
records were at these locations. All items selected for
inventory verification were found to be prebent at the
LBJ Library or the National Archives.
GIFT REPORTING BY VICE PRESIDENTS
AND SECRETARIES OF STATE
No gift unit has been established with responsibility
for recording qifts received by Vice Presidents cr S-cretar-
ies of State. These individuals have established theic own
procedures for recording their gifts and reporting them to
the Office of Protocol. A standardized set of Suidelines
or procedures has not been passed on from one Vice President
or Secretary of State to another.
To identify qifts the Vice Presidents and Secretaries of
State received, we relied on lists they provided us, Prctocol
Office records on gifts they had turned in, and in one in-
stance National Archives records. However, due to the lack
of independently available information on gifts received by
the Vice Presidents and Secretaries of State, we were unable
to test the adequacy and completeness of the rift lists. We
were able to identify from independent sources, such as news-
papers and U.S. missions personrel overseas, only a few gifts
that they had received.
Nevertheless, not all of the gifts listed on the records
provided us have been reported to the office of Protocol.
The gift recipients told us that they intend to report these
gifts.
EXECUTIVE AGENCY REPORTING REQUIREMENTS
The Executive agencies with a large number of e?aployees
overseas--Department of State, Agency for International De-
velopment, United States Information Agency, and the military
services--have issued requlations concerning employee conduct
on receiving gifts and dec.;r;,tions.
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The State Department, United States Information Agency,
and AID employees are subject to the Standards of Conduct
regulations explained in the Foreign Affairs Manual (3 FAM
621) and have the responsibility of depositing with tha Chief
of Protocol gifts exceeding $50 in value. Decorations re-
ceived must be processed through the employee's agency, since
aqency approval and the concurrence of the Chief of Protocol
are required for retaining the decoration.
The Agency for :international Development has provided
further guidance on the matter in its Manual Order 443.1.
This order require; that, if the employee i3 aware that a gift
is to be tendered, approval of the principal AID officer at
the post abroad is to be obtained before the gift can be ac-
cepted. The gifts accepted are then channeled through the
Director, Program Management Services,- to the Office of Pro-
tocol. Requests to retain gifts for official use are also
channeled through this office.
Military personnel are, generally, subject to ccntrols
similar to civilian agency regulations. Gifts of more than
$50 in value, except in the case of personnel associated with
military assistance programs who are subj,:ct to a $10 limita-
tion, are to be forwarded to the appropriate military offi-
cials. In one branch, the gift must be accompanied by a
a letter describing the gift, donor, and recipient. Upon
receip' of gifts, military officials forward them to the
Chief of Protocol or request approval to retain them for of-
ficial use. Military decorations are processed throL'gh appro-
priate commands in a similar manner.
Lack of reporting from overseas missions
We visited U.S. missions in 10 countries to identify U.S.
Government employees who received foreign gifts. U.S. mis-
sions are not required to report to the office of Protocol
gifts received by Federal employees. The missions had not
established any procedures requiring gifts to be reported to
them, nor had they maintained a systematic record of employ-
ees who had received gifts. We did note (see p. 19) that the
missions were sent a Department of State memorandum in
July 1974 on employee obligations under the Foreign Gifts and
Decorations Act, and mission heads were encouraged to acquaint
their personnel and official visitors with the contents of the
memorandum and the requirements of the law.
Generally, mission officials believed that gifts of more
than minimal value would be received by high-rankinq visitors
rather than by employees assigned to foreign countries.
Visitors were not required to report to the missions any
gifts received from the host government.
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While the missions did not have any procedures requiring
Government officials' gifts to be documented, we found indica-
tions through records maintained by secretaries, letters of
correspondence, and personal interviews with officials, that
gifts may have been received which in some cases have not yet
been reported to the Chief of Protocol. However, due to the
lack of records, we were unable to determine if these were
isolated instances or representative of a more general problem
of a lack of reoortinq.
CONGRESSIONAL POLICIES AND PROCEDURES
Members of the Conqress, their staffs, and members of
their families and households are covered by the Foreign Gifts
and Decorations Act of 1966. In our review of the nolicies
and procedures established to administer the act, we contacted
the Senate Select Committee on Standards of Conduct, the House
Committee on Standards of Official Conduct, and the Joint Com-
mittee on Congressional Operations. Senate Rule XLII requires
that qifts received durina the year from a single source, in
the aggregate amount of $50, be reported under the provisions
of Rule XLIV. House Rule (XLIII) on conduct prohibits a mem-
ber of the House of Representatives from accepting gifts of
value from any person or organization having a direct inter-
est it legislation before the Conqress. However, these rales
did not specifically address the provisions of the Foreign
Gifts and Decorations Act of 1966.
The Horse Committee on Standards of Official Conduct
issued an advisory opinion on June 26, 1974, dealinq with
foreiqn travel by members and employees of the House of
Representatives at the expense of foreiqn governments. The
opinion of the Committee, hased on advice from the Comptroller
General and the Department of State, prohibited accepting
travel or living expenses in specie or in kind from any for-
eiqn government, official agent or representatives thereof,
by members or employees of the House of Representatives, ir,-
cludinq their family and household.
Office of Protocol records on gifts and decorations show
that, as of ?Qptember 1, 1974, Members of Congress have re-
ported 23 girts valued at over $50 presented to them or their
families by foreign governments since the passage of the act
in 1966.
Because it is not uncommon for legislative branch offi-
cials to receive foreign gifts, we proposed that the Joint
Committee on Congressional Operations consider includinq a
reference to the act in the Congressional Handbook to remind
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Congressmen of their obligations. GAO Prepared an insert
setting forth )rovisions of the act, which was included in the
November 1974 edition of the Congressional Handbook.
JUDICIARY POLICIES AND PROCEDURES
The judiciary is generally broken into Lwo main divisions
foz administrative purposes: the Supreme Court of the United
States and the lower Federal courts. The Supreme Court
handles its own administrative matte=s while the Judicial Con-
ference of the United States, the governinq body for the ad-
ministration of the Federal judicial system, has an adminis-
trative office which handles those of the lower Federal
courts.
The Supreme Court and the Administrative Office of the
U.S. Courts do not have written regulations or policies that
specifically refer to the Foreign Gifts and Decorations Act
of 1966. However, on July 5, 194, Chief Justice Burger is-
sued a memorandum with an attachment from the State Department
on the subiect of the Foreign Gifts and -`ecorations Act. The
memorandum and attachment were circulated to all the justices
of the Supreme Court.
The Judicial Conference has adopted the American Bar
Association's standards of conduct as delineated in the pub-
lication "Code of Judicial Conduct." The code specifically
limits the gifts, oectuests, favors, or loans a judge or a mem-
her of his famil'' residing in his household should accept and
requires that gifts over $100 in value be reported in the
same manner as income under cannon 6C. Cannon 6C of the "Code
of Judicial Conduct" requires Federal judges to disclose all
extrajudicial income in a "Public Report of Extra-Judicial
document.
Tncome." which is filed as a public
No foreign gifts have been reported to the Chief of Pro-
tocol by judicial branch employees since the act was passed
in 1966. Our review of records and discussions with Depart-
ment of State employees did not show any gift received by the
judiciary's employees.
A "Code of Judicial Conduct for the United States Judges"
is being prepared by the Administrative Office of the U.S.
Courts as well as an updated analogous manual "Administrative
Guide to United States Courts" for court personnel below Fed-
eral judges. GAO has prepared an insert similar to the one
prepared for the Congressional Handbook for inclusion in
these two documents.
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CONCLUSIONS
The system for reportinq foreign gifts in the executive,
judicial. and legislative branches of the Government places
almost complete reliance on the recipient's voluntary com-
pliance. Additionally, Government agencieF are not required
to report qifts received by their employees or any other
Government employees to the Office of Protocol. We believe,
therefore, that improved controls and procedures should be
developed by the Secretary of State.
RECOMMENDATIONS
Although we realize that compliance with this act will
always he based larqely on voluntary disclosure by the gift
recipient, we believe certain actions should be taken to im-
prove gift reporting procedures and controls.
We recommend that the Secretary of State
--develop definitive procedures for the recording, con-
trol, and custody of gifts received by the Vice
President, Secretary of State, and members of their
families,
--request Federal agencies and U.S. missions to report
to the Chief of Protocol any Federal employees who
receive decorations or gifts in excess; of minimal
value, and
--direct the Chief of Protocol to perodically disclose
to the public all gifts reported to him, and request
an accounting of gifts received by the Vice President,
the White House staff, and Secretary of State.
AGENCY COMMENTS AND
OtiR EVALUATION
The Department of State found this report to be a com-
prehensive and useful review of the admir.?stration of the act
and its attendant problems as far as it concerned the Depart-
ment's role and functions. Additionally, the Department made
the followinq comments:
--Definitive procedures have already been developed for
handling the gifts received by the Vice President,
Secretary of State, and members of their families.
These procedures are unique, due to the high offices
of their subjects; however, these individuals have
the same obligations unc.er the law as other Federal
employees.
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--Neither Federal agencies nor U.S. missions have t'ne
oblication, nor should they hay? under the statute
or regulations, to report gifts received by their
employees. However, they should acquaint employees
with their individual obliqations.
--The Chief of Protocol should not be burdened with the
obligation of publicly disclosing gifts reported to
him, or with requesting formal accounting by the Vice
President and Secretary of State. xistinq procedures
are sufficient to satisfy such requirements, and the
foreign gift records of the Chief of Protocol are
open to the public. Further, the act confers no in-
vestigativ4 powers on the Chief of Protocol, and he
is not authorized to make such demands on employees
or agencies.
In January 1975, after receiving the Department's co?a-
ments, we attempted to obtain copies of the procedures devel-
oped by the office of Protocol for handling gifts received by
the Vice President, the Secretary of State, and members of
their families. The Office of Protocol told us that the pro-
cedures were not finalized and consequently, were unavailable
to us. We were also informed that the procedures for the
Vice President will probably be similar to President Fcrd's
new procedures, included as appendix III. As of March
1975, the Department of State's and Vice President
Rockefeller's staffs we developing the Vice President's
new procedures for hanc ing gifts.
The Chief of Protocol is charqed with administering the
Foreign Gifts and Decorations Act of 1966, a function that,
we believe, he should carry out vigorously. The acceptance
of gifts takes place in many widely separated 7oV\.catL:Iol-1.
--.r ~?-rw-~~-. 1J?
Consequently, for the Office of Protocol to act zs a central
point for the collection of records regardinq this activity,
it is necessary for the Office to recei'Te substantial coopera-
tion from the agencies, missions, rnd individials, including
hiqh officials, involved. We believe the Chief of Protocol
should take the initiative in fostering this ccooeration,
which we feel would be easily attainable. We also believe
the Office would not exceed legal limitations by recuesting
a formal accounting of gifts received from these areas.
The Chief of Protocol's gift records are open to the
ouolic under the Freedom of Information Act. However, we
believe that an additional requirement for public disclosure
would he beneficial in that it would serve to dispel tole
public cynicism surrounding the acceptance of gifts by public
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servants. This disclosure shoul: foster additional confidence
in Government officials by demonstratinq that t`ev are cor.:aly-
inq with the law and receiving little personal aain from
the practice.
We believe the appropriate vehicle for public disclosure
would be periodic reoorcinq in the Federal Pe.a'ster. Further,
we believe that these actions would be welcomed by most and,
in view of the importance of the subject, would be good adminis-
trative practice.
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CHF.PTER 3
ADMINISTRATION OF THE ACT
NEt;D FOR CLARIFICATION OF THE ACT
The Foreign Gifts and Decorations Act provides that
certain foreign gifts and decorations cannot be retained
by reci-ients and must tie deposited with the Government
pursuant to regulations. However, the law cannot be effec-
tively enforced due to three basic rieficiencie3 in the act:
--The present system for reporting gifts relies
heavily on voluntary disctc.sur.e by the gift
recipient.
--The law specifies no time period for compliance.
--The act specifies no sanction or penalty for
noncompliance.
The Office of Protocol has informed us that, since the
act Provides that gifts of more than minimal value become
the property of the United States upr?n accenrance by a
Government employee, sanctions ar, available under various
laws and regulations r:'lated to the control, use, and dis-
posal of Federal property. 6e agree that -riminal and civil
sanctions theoretically are available under these laws and
regulations. One such sanction is contained in 13 U.S.C.
?641, unoet which a gift recipient who retains a foreign
gift in violation of the ict may be subject to criminal
prosece?*ion for converting property of the United States.
However, we know of no case in which these sanctions have
been used and, in our opinion, as a practical ;natter,
they cannot be ised effectively.
Frr example, tie Foreign Gifts and Decorations Act
clearly contemplates that there are time.; when gifts may
be accepted though not retained. Once accepted, the law
must P-r.iit the recipier.' to retain the c,ifc for a period
or t'.e befo.e the obli'atior. to deposit the property with
tae office of Protocol develops into a vio~ation of the act
-Jarranti g the imposition of a civil or criminal penalty.
However, as stated Ereviously, the length o: this time
period is nn' defined in the act or the regulations. More-
over, the cr :nationj of "gift" and "foreign government"
provided in ne act and implementir(I regulations do not
specify wit.t su.'~icient ciarity the type: of gifts that
they cover. In summary, the r.)reign Gifts and Decorations
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Act is extremely vague on these ane other important
issues affecting enforcement of the act under existing
law and leaves any attempt to impose a penalty for its
violation vulnerable to challenge.
The act has other major weaknesses, not related
to the question of sanctions, which further limit the
effectiveness of the law. or ex3mnlc, certain experts
and consultants hired by the Government presently are
not covered by the act. Their exclusion results from
the definition of "employee" adopted in the act.
Additionally, zhe act may result in inequitable treat-
ment and fail to eliminate a potential source of foreign
influence in that a member of a Federal employee's family
living in the employee's household cannot retain gifts he
receives, while a family member residing in nis own house-
hold can. This interpretation results from the definition
of "member of the faa.ily and household" (emphases added)
contained in the act. OnTy family members who are in the
same household of a covered employee are required to report
gifts.
There is a countervailing consideration, however, that
the Congress may wish to consider before extending coverage
to family members who reside outside an employee's house-
hold. Ameiding the act to eliminate this problem will sub-
ject thousands of private citizens to the act's restric-
tions merel" because they are related to an employee of the
Federal Government. Many may consider this an extreme re-
sult. Thus, the Congress should care,'ully weigh the compet-
ing policy considerations before amending the act to provide
coverage of family members living outside an employee's
household.
The act also is not clear as tc' whether gifts from
foreign quasi-governmental or multinational organizations
need to be reported--for example, gifts which are received
from officials of multinational organ;::ations, such as the
United Nations and the North Atlantic Treaty Organization,
or foreign associations, such as the Organization of
Petroleum Exporting Countries. The Department of State
has ncted that multinational organizations are not specifi-
cally included in the stat.'te. The Department believes,
however, that any gift by ti.ese organizations could be
considered a foreign gift .?nder the statute because of
the nature of the organization or because of the function
that the organization serves as the agent of a foreign
government.
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Neither the act nor its implementing regulations
requi:e an independent appraisal of the gifts. Under
current regulations, the recipient has the responsibility
of establishing that the gift is worth less than minimal
value. We found certain gifts had been reported that
were relatively worthless. At the other extreme we noted
apparently valuable items not yet reported.
The Department of State has indicated that establish-
ing a system for independent appraisal of gifts would
create a variety of new problems--who would perform the
appraisal, at whose expense, would several appraisals be
needed for certain art work:--as well as the problem of
the attendant administrative burden. We are aware of
the possibilities for new problems; however, a .-or.kable
independent system is feasible and worthwhile. Establish-
ing such a system would provide for an objective, uo biased
appraisal of gifts, effectively neutralizing any potential
for impropriety.
It is also unclear from the act and the legislative
history whether the Congress intended to grant the Pre.i-
dent independent authority to dispose of foreign gift;
and decorations--the vies; adopted by the State Departoent
and the General Services Administration--or whether ti-e
Congress intended such gifts and decorations tc, he disposed
of ur.9er the same authority and in th? same manner as
other Government property. The language of the act could
be interpreted to support either contention. Moreover.
there are policy considerations to support both views.
The President traditionally has been given wide latitude
in matters influencing foreign relations and, thus, it is
not unreasonable to conclude that the Congress intended to
grant the President independent authority under the act to
dispose of foreign gifts and decoration.;. On the other
hand, under this interpretation, there is the possibility
of abuse since there is no limitation on the President's
authority for the ultimate disposition of a fore:yn gift
or decoration.
ACTIONS THE OFFTCS OF PROTOCOL
U(HAy i 'FAK U --
The Chief of Protocol is responsible for gifts which
become the property of the U.S. Government under the pro-
visions of the Foreign Gifts and Decorations Act. The
Office of Pi utoc,:l as stated w'th respect to its authority
and responsib'lities under the act and implementing regula-
tions that neither the Secretary of state nor the Chief of
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Protocol has any investigative, recovery, or enforcement
powers needed to compel compliance with the act. The
Office of Protocol also has implied that its role is limited
to receiving foreign gifts deposited by pe-sons who volun-
tarily comply with the statute and requlati,,%ns. We cannot
agree with this position.
We recognize that the act and the regulations rely
largely on the personal integrity of gift recipients and
on their willingness to comply voluntarily with the law's
requirements. However, there are four actions which Pro-
tocol could have taken to administer the act more effec-
tively without express statutory or regulatory authorization.
It could have (1) advised the Congress of the difficulties
encountered in implementing the law, (2) suggested that
Federal agencies report any gifts received by their employees
which were within the scope of the act, (3) documented known
instances of noncompliance with the act, and (4) advised
gift recipients of the provisions of the act.
The Office of Protocol has, however, not done any of
the above. Its failure to advise the Concress of the dif-
ficulties being encountered in administering the act, we
believe, stemmed from its reticence to report certain
individuals who failed to report all gifts they have
received.
Individuals receiving gifts are often in the higher
civil service grades cr hold electiv: or high appointee
positions. The Office of Protocol appeared reluctant to
document gifts received by these individuals as well as
others. For example, a protocol officer accompanies the
President, Vice President, al.d Secretary of State and cer-
tain other officials on trips abroad and is involved in
recording and shipping gifts they receive. A copy of the
processing form protocol officials used is shown below.
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t G..T row
(..weJ
LJovs ?c..... 100(0 M .OS.
/CD.. O..1.... ?...-.t
O SO ? [ .C..C.L I DGI O 01
I'll..,... p. ?! (..>~d..t...
f f(.s..l M?n *Fr.l1
N..tIsA. N T..'.... pvu. to d.r. r...
NOTE. FIVE COPIES 0: THIS FORM SHOULD BE PREPARED AND DISTTBBUTED AS FOLLOWS
COPY GIVEN TO MR THOMAS WITH DRAFT LETTEP.S ATTACHED.
COPY GM1FN 170 OEPARTMf:YT OF STATE REPRESCh7\TIVE.
3. COPY AFFIXED OUTSDSF SNIPPING CONTAINER.
4. COPY E%CLOSED IN BOY 11TH GWT
5 COPY RF.TAI\LD BY POST GIFT OFFICER.
SON PERISHABLE GIFTS SHOLLD BE SENT TO- W. Joh. M. Thous A OPR
t.f... d OP.r ons R,vc. I:C
U 5 DEPARTMENT OF STAT.a.
1 sA.npon, U.C. 10510
PERIHAD;,F. GW'TS S.ch .s Do.... In.t w s..47 sho.I4 he r.t..ned h) Po.. GO, XtKa
D~sp.ntSo. of s.ch .lens to ie d111.u ne'd !i M. TN-.s.
The Department of State informed us that these records
are prepared to assist an individual in identifying and
acknowledging gifts; nevertheless, these records, if retained
by the office of Protocol, would have provided a partial
check on the gifts received. However, State officials told
uJ they do not retain any of these records.
GOVERNMENT EMPLOYEES' NOTIFICATION
ON PROVISIONS F THELAW
A number of officials who had received gifts out had
not reported them stated they were unaware of the provisions
of the law. However, the executive, judicial, and legisla-
tive branches of the Government have recently initiated
efforts to publicize the provisions of the act. For example,
the State Department, on July 1, 1974, issued a i.ew direc-
tive to all Government agencies reminding Federal employees
of the provisions of the act. (See app. II.)
Ir. an airaram trallsmitting the July 1, 1974, directive
to the .mbassie.s, the Department of State required that:
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--The principal officer at each post take appropriate
measures to insure that all employees under his
direction read the attached memorandum concerning
employee responsibilities under the act.
--The principal officer make certain that visiting
U.S. Government officials are fully aware of the
operation of the law and regulations concerning
the acceptance and retention of foreign gifts
and decorations, and that they are advised of any
local gift-giving customs.
--Chiefs of missions initiate a tactful but thorough
program of orientation aimed at key officials of
the host government.
A diplomatic note is also being circulated to transmit
the provisions of the law to foreign embassies in Wash-
ington, D.C.
As discussed in chapter 2, the Congressional Handbook,
which is provided to in:oming senators and representatives,
is being revised to contain a brief summary of the provisions
of the law. The "Code of Judicial Conduct for the United
States Judg s" and the "Administrative Guide to United States
Court,s", which prescribe the codes of conduct to be followed
by employees in the judicial branch, will soon be amended
to contain a similar summary.
CONFUSION ON TYPES OF ('iFTS
REQUIRLD TO BE REPORTED
During our review, we discovered considerable con-
fusion among gift recipients and within the Office of
Protocol over the types of gifts covered by the act. The
confusion resulted from these erroneous assumptions
regardinc the nature of a gift that must be reported:
--A personal gift given by a foreign official
need not be reported.
--A gift from a member of a governmental unit
other than the National Government, such as
a State or local government, need not tte
reported.
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The intent of the law was to curb foreign influence
upon Government officials. We believe that any gift from an
official of a foreign government, whether a personal gift or
state gift, comes within the scope of the law. The Office
of Protocol has now adopted this position. However, some
individuals have thought that if a personal gift were given
by a foreign official it need not be reporte,.i. Further, the
law is unclear whether a gift from a member ot a foreign of-
ficial's family, for example a wife, is required to tie re-
ported. The question of whether such a gift should be con-
s?dered .:fficial remains unanswered.
There is also considejable confusion among gift receip-
ients as to whather gifts from local government officials,
for example a mayor, need be reported.
ACCEPTANCE OF TRIPS OP. TRAVEL.
AT THE EXPENSE OF FOREIGN GOVERNMENTS
On several occasions, the question has been asked by
Members of Congress and employees of various Federal agencies
whether the acceptance of a trip or travel expenses provided
by a foreign government is proper under the Constitution and
the Foreign Gifts and Decorations Act. The extent of travel
provided at foreign government expense is suggested by our
findings concerning the Republic of China (Taiwan). It is
common practice for Taiwar, to pay travel expenses of Members
of Congress and Federal employees invited as official guests.
Based on only fragmentary records, we estimated 'hat, at a
minimum, in excess of $100,000 was spent by Taiwa. for these
expenses during the past 2 years.
First, we hive determined, and the Department of State
agrees, that under existing laws the "acceptance of gifts
of tr ing abroad by Members of Of ? yrc.~u or members VL LIIC lI
staffs that are paid for by foreign governments" is not
permitted in most instances. We believe the same rule ap-
plies to other Federal employees. As a general rule, in-
tancjible gifts provided at the e).-pense of foreign governments,
such as trips or travel expenses, are "emoluments" within
the meaning of Article I, section 9, clause 8 of the U.S.
Constit~!cion, and under that provision; they canno'- be
accepted without congressional consent. However, the term
"gift" as defined in the Foreign Gifts and Decorations Act
is sufficiently bread to encompass such items, Thus, trips
or travel expenses f less than minimal value may be
accepted under the at.
Nevertheless, trips or travel expenses offered by fcr-
eign governments usually inv,)lve trips abroad and cost in
excess of the $50 minimal value figure. While the act pro-
vides that gifts of more than minimal value may be accepted
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under limited circumstances, it also prohibit,. retention of
these gifts by the donee. Such gifts become the property
of the United States upon acceptance and must be deposited
with the Gov(-cnment. In other words, with respect to gifts
of more than minimal value, the act only contemplate.3 the
acceptance of those that can be deposited with the (,evern-
ment. The act cannot be interpreted to authorize '.ie ac-
ceptance of gifts of more than minimal value when the nature
of the gifts precludes the donee from depositing the gift
with the Government.
Second, we believe th~.t provisions should be made to
c)arifv those cases where the benefits conferred by the for-
ei.r. country are extended 4uring the course of cfficial busi-
ness with U.S. officials who otherwise would be reimbursed by
the United States, and where the gift clearly is to the United
States, and not to the individual involved. An example of
this would be the situation in which a host country provides
some transportation, food, and accommodations to members of a
diploinatic mission. In this case, if the host government did
not pay for these expenses, the U.S. Government would, and the
gift thus extends to the United States. No gift or reimburse-
ment to the individual is involved. Under these limited c.Lr-
cumstances the acceptance of transportation, food, or accommo-
dations provided by a foreign government would not fall within
the constitutional prohibition.
we believe that where the circumstances and conditions
are such that situations similar to the above exist, and
where a cognizant official in the legislative and judicial
branches or an agency head and Secretary of State or his
designee in the executive branch, a., appropriate, certify
that the tr?.p is official business, the employee may accept
transportation, food, or accommodations offered by the
t. einn govrernment Legislation should be -act d (I % ? t_
ing this policy, (2) specifically designating officials in
the legislative and judicial branches to carry out the
policy, and (3) directing the Secretary of State to issue
guidelines.
CONCLUSIONS
Because of the high positions geflerally held by gift
recipients, enforcing the act is difficult and is unlikely
to be accomplished without certain changes in the law.
Action that can be taken against Government employees who
fail to comply with the law is limited by the act's failure
to specify a time period for compliance and the lack of an
effective penalty for noncompliance. Also, the act's lack
of clarity in certain areas and placing responsibility on
the individual for evaluating gifts has affected its past
administration.
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Provisions of the act have been disseminated among the
executive, legislative, and judicial branches of the Govern-
ment. However, it appears that more detailed guidance is
needed to help insure compliance.
The act does not contain the Congress' consent to the
acceptance of intangible items of more than minimal value
such as travel expenses. We believe legislation sho'ild be
enacted to clarify those unique circumstances and conditions
where it is appropriate to accept such intangible gifts.
The Department of State gift records are accessible to
the public under the Freedom of Information Act. However,
we believe that some type of additional requirements for
public disclosure of gifts received might allay the fears
of influence that are often associated with the receipt of
a gift.
RECOMMENDATIONS
In order to provide an appropriate framework for ad-
ministering the Foreign Gifts and Decorations Act of 1966,
we recommend that the Secretary of State:
--Provide more detailed guidance to Federal agencies
concerning those provisions of the act which are
confusing or subject to misinterpretation.
--Direct the Chief of Protocol to note acid document
gifts known to have been received but not reported
or deposited. After notifying the gift recipient
of his responsibilities, consideration should be
given to notifying the Congress and other appro-
priate officials and to documenting action taken.
AGENCY COMMENTS' AND
659EVADiTTION
The Department of State, in responding to a draft of
this report, made the following comments:
--Actions, which GAO feels the Office of Protocol could
have taken, were not taken due to the absence of en-
forcement and compliance authority. The Department
has stated that it could not have taken any action
which would have led to broader compliance with the
act, and its inability to administer the Act is
entirely unrelated to any positions which the in-
dividual gift recipients may hold.
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--Records of trips abroad were not retained because
there are no statutory or regulatory obligations
imposed on the State Department and the Office of
Protocol to use the information contained to
enforce provisions of -.he act.
--Reticence on the part of the office of Protocol to
advise the Congress of difficulties enc3untered in
administering the act stemmed from its inability
to effect compliance in a general way, rather than
its sensitivity toward individual donees who may
or may not have reported gifts.
We agree that the Department of State does not have--
nor should they have--power to enforce compliance with the
act. However, we believe, as stated previously, that the
Office of Protocol has a responsibility for its vigorous
administration. We recognize that there are legal limita-
tions on that responsibility; however, the actions which
we indicate could have been taken do not require express
legal authorization. These actions are simply symptomatic
of prudent administration and intergovernmental cooperation.
Further, we believe that the absence of formal obligations
to keep records should not deter any governmental entity
from that activity, when it is essential :o the proper
performance of its duties and within the law.
MATTERS FOR CONSIDERATION BY
TEE CONGRESS
It is evident that a need exists to amend the Foreign
Gifts and Decorations Act to provide the basis for ade-
quately implementing the constitutional intent to control
the impact of gifts given by foreign governments. Further,
..d LA LJCJ f :or CIJIs.LI Vt 5.4L t . IL Glover 11111 VI..I C to L L.. V JC ..L b
need CL? -
lish separate arrangements to see that the statute is
follc.wed. GAO belie~,es it is unreasonable to expect the
Office of Protocol to be in a position to effectively
administer the act with respect to the legislative and
judicial branches. ,accordingly, GAO believes the act
should be amended to stipulate that
--separate entities be responsible for administering
the act in each branch of the Government,
--gifts be reported and deposited within a specific
period of time from receipt,
--there be an effective penalty for noncompliance
with the act,
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--appropriate coverage for temporary or intermittent
experts and consultants be provided,
--permission be required from the Secretary of State
before selling or trading a foreign gift, and the
General Services Administration be given authority
to conduct negotiated sales (see ch. 4), and
--responsibility for defining minimal value be given
to the President and be defined as a specific
dollar value not subject to interpretation (pos-
sibly $100 U.S. retail price at time of purchase),
with consideration being given by him from time to
time to makivg the value reflect inflation factors.
The act should be further_ amended to
--require public disclosure of gifts and their in-
dependent appraisal,
--clarify whether gifts from quasi-governmental
and multinational organizations are included
under its provisions,
--distinguish and provide for the acceptance of in-
tangible gifts nd emoluments of more than minimal
value, such as travel, where the benefits clearly
accrue to the U.S. Government as opposed to the in-
dividual, and when approved by an appropriate offi-
cial of the executive, legislative, and judicial
branches.
--clarify whether the President or his delegate is
authorized to dispose of foreign gifts gnd decora-
tion, witi?ut regard to the restrictions of other
statutes governing disposal of U.S. property, and
--clarify if a gift from a member of a foreign
official's family is to be considered a gift
from a foreign government.
When considering the amendment and administration
of the act, the Congress may wish to consider, in the
interest of perspective, alternative policy options.
Four approaches and their relative advantages and dis-
advantages are discussed below.
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Consenting -to_the acce tance of gifts where their
refusal would likely cause offense or embarrassm:--nt
or adversely aff-ecttheforeign relations of the
Uniet-States, with the recipient aermitteT to
r.etainthose-ot m nlmah value (current aapa oach) .
--Recognizes that it is a diplomatic custom to exchange
gifts, and respects the historical ar.J sociological
precedents which form this custom's base.
--Reduces the potential for foreign influence by
prohibiting retaining valuable gifts by recipients.
Disadvantages:
--Creates difficulties in administering the law. For
example, there are sensitivities encountered by the
administrators of the law because they lack in-
dependence from the prime gift recipients--President,
Vice President, Secretary of State.
--Relies largely on voluntary compliance by the gift
recipient. In this approach there are many in-
stances where personal judgment is subjected to
the strain of an opportunity for personal gain.
Consentin to the recipient's retention of gifts
o -minimal-value ue where t eir re usf al wou ike
cause offense or embarrassment or adverselyy afffe t
the foreign relations~the tnited States, arid
prohibiting the acceptance of-gifts above such value.
--Recognizes the diplomatic custom of exchanging
gifts, and respects the historical and sociolog-
ical precedents which form this custom's base.
--Reduces the potential for foreign influence by
prohibiting the acceptance of a gift over a
stated value.
--Eliminates the temptation which may arise after
the acceptance of valuable gifts.
--Reduces administrative problems associated wi'-h
the act--for example, handling, storage, and
disposition of many valuable items.
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Disadvantages:
--Creates diplomatic problems in that retaining
valuable gifts, long a part of diplomatic
custom, is not allowed.
--Creates difficulties in administering the law,
particularly in designating a Government agency
to implement the law which has necessary inde-
pendence from prime gift recipients.
--Places responsibility on the gift recipient for
an on-the-spot judgment on the value of the gift.
--Relies largely on voluntary disclosure by the
gift recipient. In this approach, as in the
first, there are many instances wi.ere judgment
may be clouded by temptation for personal gain.
Consenting to the recipient's acceptance and reten-
tion of aiI guts, where their refusal -would likely
causeense or em arrassment or adv se y aT'ect
the ei relations of the _UnitedStates.
Advantages:
--Respects the diplomatic custom of exchanging gifts.
--Eliminates administrative difficulties.
Disadvantages:
--Provides no protection from foreign influences,
except that provided by public disclosure of
gifts received which would be a necessary part
of this Approach.
--Permits gift recipients to obtain substantial
personal gain from their government position.
Pro iibitinq theacceptance-of_anygifts by Federal
em Io ees.
Advantages:
--Reduces the potential for foreign influence.
--Reduces administrative difficulties.
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Disadvantages:
--Disregards the diplomatic custom of exchanging
gifts.
Relies on voluntary compliance by the gift recip-
ient. It would be unrAal istic to assume that
all situations in which gifts could be tendered
could be controlled; therefore, the recipient's
desire to comply becomes of paramount importance.
While each of these alternative policy approaches are
reasonable, we have drafted a revised statute, based on
the current approach and the problems identified during
our review. (See app. V.)
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CH;.PTER 4
QUESTIONABLE DIST SITION AND USE OF GIFTS
Once , ' ift is reported to the Chief of Protocol he
permits it to be used for official purposes or declares
it to be excess personal property and turns it over to
GSA for disposition.
DISPOSITION OF GIFTS
As briefly discussed in Chapter 1, gifts which are
forwarded to GSA are sometimes accompanied by instructions
concerning their disposition. In the absence of such instruc-
tions the items are 'isposea of in accordance with the pro-
visions of tie Federal Property and Administrative Services
Act of 1949, as amended. Under this act, GSA has few
options. Museums and other Government entities are noti-
f=.ed that the property is available. If there are no
requests for the property, GSA r-, either store the gifts
or publicly sell them. The Department of State has noted
some concern over the public sale of foreign gifts because
of the possible effect on foreign relations.
The act does not give GSA the authority to Londuct
negotiated sales of foreign gifts. GSA must sell Lhese
items at public auction. Although GSA recognizes thit nego-
tiated sales would not necessarily generate the highest
proceeds, they believe this type of sale may better serve
the overall interest of the United States in view of the
potential effect on foreign relations. Additionally,
negotiations with gift recipients, subject to appraisal
and appropriate safeguards, they believe, would seem
appropriate in certain circumstances. GSA beiieves the
Congress should addr-cs those questions and provide
GSA with authority to negotiate sales.
As of September 1, 1974, records show that 433 gift
had been turned over to GSA of which 283 gifts sere on
hand and 130 had been transferred or sold as follows:
Smithsonian Institution 131
Deoartment of the Army 5
White House 4
National Archives and 2
Records Service
GSA Federal Supply Service
Sold 7
Total 150
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In addition to the above mentioned gifts transferred
to GSA, the Office of Protocol had deposited 10 cash gifts
totaling $13,000 directly with the U.S. Treasury. Addi-
tionally, the Office had five gifts on hand at September 1,
1974.
Questionable disposition of
41 is by the Smithsonian
As shown above, the Smithsonian Institution has been
the primary recipient of the gifts that have beer trans-
ferred to GSA for disposition. We examined the records of
59 gifts, valued by the State Department at $26,789, from
the total of 131 acquired by the Institution as of
September 1, 1974. From these 59, we selected 30 gifts
(valued at $5,694) which had been acquired in 1969,
1970, and 1971 by the Smithsonian's Department of Min-
eral Sciek,ces, to determine if they used ail controlled
them properly.
These gifts were chosen because of h?ir questionable
usefulness as oojects for display. For example, 14 of
the 30 gifts selected were wristwatches. We found that
most had been acquired by this department with the intent
of exchanging or selling them in orGer to obtain other
objects more suitable for display. Of the 30 gifts
chosen, 26, valued at $4,894, were exchanged or sold--
16 being exchanged or sold within 3 months of their
acquisition.
Although items of value were received in return for
the objects exchanged, we were unable to determine the
value received for specific items since many of them were
from various sources end were exchanged or sold together.
Additionally, shipping documents did not identify, in
certain cases, the gifts tepurtedly exchanged or sold.
A Smithsonian Institution internal audit report in
May 1972 had disclosed weaknesses in the controls and
accounting over items being obtained from the Bureau of
Customs. As a result of this audit, the Institution has
halted sales and exchanges of Bureau of Customs material
and also foreign gifts.
Suugested changes _b`Otfice
of A'uaTits, GSA
While we were reviewing the Act, the Commir.3ioner,
Federal Suonly Service, GSA, requested the Office of
Audits, GSA, to review GSA's management of those foreign
qifts and decorations reported as excess personal prop-
erty oy the Chief of Protocol. An objective of the
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audit was to review the methods, procedures, and prac-
tices used by GSA in accounting for and controlling the
receipt, movement, storage, and ultimate disposition of
foreign gift items.
The Office of Audits found a need for improved
methods, procedures, and documentation to insure more
effective control, accountability, and use of foreign
gifts. In its opinion, the required improvements can
be accomplished through developing and implementing a
centralized inventory control system which would account
for the foreign gifts from initial reporting to their
ultimate disposition.
The Office helieved the system should incorporate
such management control techniques as written procedures
and guidelines, centralization of data files, periodic
inventory, physical possession and delivery of the items
by GSA, and improved screening procedures and documenta-
t ions.
The Office's findings and recommendations were
presented to the Commissioner and other appropriate GSA
officials in July 1974. We have been told that correc-
tive action has already been initiated on some matters
and additional action is planned to implement the other
suggestions.
LACK OF CONTROL OVER
OFFICIAL-USE ITEMS
Through September 1, 1974, the Office of Protocol
had permitted retaining 94 foreign gifts for official
use, with the stipulation that when the individual leaves
office or the gifts no longer are needed for tale purposes
authorized, they be returned to the Office of Protocol.
We noted that the Office had no followup procedures with
respect to official-use items.
We made a study on 30 of the 94 gifts retained for
official use. Initially, we could not locate 16 of the
gifts selected and found another 9 were not being
used for the purposes authorized; we requested the Office
of Protocol to determine the location or disposition of
the 16 gifts. By December 2, 1974, the Office of Protocol
was able to locate and control t1l but three of the gifts
identified in the test.
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CONCLUSIONS AND RECOMMENDATIONS
We believe there is a need for greater control by
the Office of Protocol of gifts retained for official use
and therefore recommend to the Secretary of State that
the Chief of Protocol periodically followup on these
gifts.
We are encouraged by GSA's recent actions to improve
its system for handling foreign gifts. Because of the
political sensitivities involved in the sale of foreign
gifts, we are recommendi,:; (see ch. 3) that the act be
amended to require permission before these sales, and
that GSA be given authority to conduct negotiated sales
of these gifts.
AGENCY COMMENTS AND
OUR EVALUATION
The Department of State believes that responsibility
for property control, and inventory system responsibility
for gifts retained for official use, must rest with the
user possessing physical control of an item. The Department
contends that problems in the past resulted because the
Office of Protocol did not make it clear to the agency
requesting retention of property for official use that
such property should be controlled and accounted for at
all times, like other Federal property within the agency's
jurisdiction. The Department informed us that new
criteria has been developed for passing upon such agency
requests, and subsequent correspondence with agencies
will state agency responsibilities concerning the safe-
guarding of this property.
We are ei.couraaed by the Department's new procedures
on agency requests to retain gifts for official'use. We
agree that ultimate responsibility for property control
and inventory must rest with the user possessing physical
control of an item. However, we do not believe, because
of the potential foreign policy implications, that this
relieves the Chief of Protocol from responsibility to
insure that gifts on official use are used for their
stated purpose.
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CHAPTER 5
DECORATIONS
Whenever a U.S. Government employee receives a deco-
ration from a foreign government he is required to obtain
the approval of his agency and the concurrence of the
Chief of Protocol to retpin it. Should the agency dis-
approve or the Chief of Protocol not concur in its reten-
tion, it :s to be deposited with the Chief of Protocol
for disposition.
An exception to the above procedure is the presenta-
tion of decorations to U.S. military personnel for service
in Vietnam. The Congress specifically y:anted its consent
in Public Law 89-257, 79 Stat. 982, for retaining such
decorations.
ADMINISTRATIVE BURDEN
We found that the agencies were submitting to the
Chief of Protocol for his concurrence lists of employees
who had received decorations. The Department of Defense
whose personnel are the prime recipients of decorations,
has iss"ed explicit regulations on reporting decorations.
In our visits to Defense commands overseas, we four,
officials to be aware of military personnel and civilian
employees who Lad received decorations.
Officials of the Departments of State and Defense,
and civilian agencies with whom we discussed the decoration
procedure, believed that decorations are being properly
controlled under existing procedures and regulations. One
problem noted was the disposition of decorations which the
Ch:~.~ ~ of of nirotocoi
... cw? or agencies (ldCi disapproved for reten-
tion. GSA has had difficulty in disposing of the items
due to their lack of demand for display purposes and *.eir
limited monetary value. We noted that as of September 1,
1974, about 500 decorations were at GSA or the Office of
Protocol. A GAO photograph of certain decorations which
were ac the Department of State is shown below.
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From the passage of the act in 1966 through Septem-
uer 1, 1974, it was estimated that several thousand
decorations had been approved for retention by the Chief
of Protocol. Although hampered to some extent by the
unavailability of r::cords, we noted only a few instances
in wnicn decorations had been received but not yet
reported.
Many of the decorations which are being processed
through the agencies for approval and concurrence by the
Chief of Protocol have only minor significance and most
are of little material value. However, much paperwork
is associated with obtaining approval to retain these
decorations. For example, U.S. Army and Air Force
officers in Germany were recently processing about 200
requests per month for retention of awards. Tito are
pr i:nar ily marksmanship badges awarded during German-
A,nerican firearms matches. We noted that the Chief of
Protocol has since granted blanket concurrence to the
Army and Air Force to perform their own review of such
qualifications and sk?ll badges.
CONCLUSIONS AND RECOMMENDATIONS
The provisions of the act--to accept and retain
decorations--are generally being toll-)wed. We believe
past instances of failing to report decorations were the
result of lack of knowledge of the law and any future non-
compliance should be reduced by recent notification meas-
ures taken by the Department of State and the Congress.
(See ch. 3.)
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Current procedures, however, do rose an administrative
burden for Defense and the Office of Protocol. In our
opinion, the minor significance of certain decorations
does not justify the administrative burden associated with
aouroval. We believe that the Chief of Protocol's blanket
concurrence to retain certain types of decorations--such
as marksmanship badqes--would reduce the administrative
burden and would not affect compliance with the act.
We, therefore, recommend to the Secretary of State that
the Chief of Protocol review the recurring requests for
authority to retain various classes of medals and and badges
and consider providing blanket concurrence to the Armed Forces
for those badges and medals that are of nominal stature. We
believe that if the Office of Protocol provides such con-
currence, the military departments should also delegate this
aooroval authority to a command level consistent with the
statute attached to the medals.
AGENCY COMMENTS
The Department of State and Defense agreed with our
recommendations concerning the desirability of reducing
the administration burden of processing routine decora-
tions. State told us that a review of recurring requests
will be undertaken with a oossible provision of blanket
concurrence where it is appropriate.
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CHAPTER 6
SCOPE OF REVIEW
We reviewed the controls, policies, and procedures
in the executive, legislative, and judicial branches of
the Government for the administration and operation of
the Foreign Gifts and Decorations Act of 1966 and subse-
quent legislation, Executive orders, end regulations.
We interviewed officials and examined pertinent
records and procedures of the Executive Office of the
President, Department of State, GSA, Agency for Inter-
national Development, Peace Corps, United States Infor-
mation Agency, National Aeronautics and Space Adminis-
tration, Department of Defense, Smithsonian Institution,
House Committee on Standards of official Conduct, Se:.ate
Select Committee on Standards and Conduct, Joint Commit-
tee on Congressional Operations, Administrative Office
of the United States Courts, and Supreme Court of the
United States. Additionally, we interviewed officials
associated with recording gifts received by individuals
who hold or have held the office of President, Vice
President, and Secretary of State since the passage of
the act.
Our review was conducted at numerous locations in
Washingt:,,,, D.C., the LBJ Library in Austin, Texas, and
at Department of State missions in 10 countries--Iran,
Morocco, Germany, .;ordan, Korea, Thailand, Japan, Taiwan,
Brazil, and Mexico.
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J. W. FULSPIGHT. ARK.. CHAIRMAN
JOHN EPARKMAN. ALA. GEORGE D. AIKEN. VT.
MIKE MANSFI!LO. MONT. Eli T0RD P. CASE, N.J.
FRANK CHURCH. IDAHO JACO? K. JAVITI. N.T.
ITUART IYMINGTON, MO. HUGH ?COTT. PA.
CLAIKORNC PELL. R.I. JAMES ?. PEAPION, KANH.
SA E LE W. MC GEE. NW. CHARLES N. PERM, ILL Gt~ifea J ifaf ez .. iercaf e
DMUND S MUIKIE. MAINE INC AERT P. GRIFFIN. MICH.
GEORGE MC GOVERN. S. OAK.
HUSENT H. HUMPHREY. MINN. COMMITTEE ON FOREIGN RELATIONS
PAT M. HOLT. CHIn OF STAPP WASHINGTON. D.C. 20510
ARTHIJR M. KUHL. CHIEF CLLRK
April 11, 1974
The Honorable Elmer B. Staats
Comptroller General of the
United States
Washington, D. C.
In order to assist the Committee on Foreign Rela-
tions to fulfill its legislative review function under
the Legislative Reorganization Act of 1946, as amended,
I request that the General Accounting Office make a
report to the Committee on the administration and opera-
tions of the Foreign Gifts and Decorations Act of l;5o,
and subsequent legislation, executive orders and regula-
tions, copies of which are enclosed.
If you should have any questions about this matter,
Mr. Pat Holt, Chief of Staff of the Committee, will be
glad to discuss them with you.
Thank you for your courteous consideration of this
request.
Sincerely yours,
John Spailkman
Acting Chairman
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July 1, 1974
MEMORANDUM
TO HEADS OF ALL FEDERAL AGENCIES
FROM The Chief of Protocol
SUBJECT: Foreign Gifts and Decorations Act of
1966: Employee Responsibilities
The Foreign Gifts and Decorations Act of 1966
(Public Law 89-673), as amended in 1967 (Public
Law 90-83), 5 USC 97342, 22 USC 92621, declares
Congressional policy that employees of the
United States Gcvernment shall not request or
otherwise encourage the tender of any gift or
decoration gram any foreign government or
official thereof, and may not accept or retain
any such gift or decora'-.ion, except as specifi-
cally provided in the Act. By Executive Order
11320, dated D~-:.ember 12, 1966 (31 F.R. 15789),
the President delegated to the Secretary of
State the authority to prescribe rules and
regulations to carry out the purposes of the
Act. These regulations were published on
April 28, 1967 (32 F.R. 6569) and are contained
in Title 22, Code of Federal Regulations,
Part 3.
In furtherance of the responsibility delegated
to the Secretary of State, this memorandum is
being circulated to remind all employees of their
responsibilities under the Act and regulations
and to ,.espond to inquiries concerning their
provisions which have arisen from time to time.
It is requested that all agency heads bring this
information to the attention of employees of
their agencies.
The Act is applicable to all employees of the
United States Government as defined in 5 USC
97342. In addition, members of the families and
households of such employees are included within
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I
the Act's coverage. These persons are under an
obligation not to accept gifts from foreign
governments or their representatives, except
when the gift is of minimal value and tendered
as a souvenir or mark of courtesy and except
under circumstances in which refusal of a gift
of more than minimal value "would be likely to
cause oi:fense or embarrassment or otherwise
adversely affect the foreign relations of the
United States." Decorations, including "any
order, device, medal, insignia or emblem" from -
a foreign government, may be accepted, retained
and worn only if "tendered in recognition of
active field service in time of combat operations
or awarded for other outstanding or unusually
meritorious performance" and only upon approval
by the employee's agency head, with concurrence
of the Secretary of State. These restrictions
a::fect gifts and decorations received on or after
October 14, 1966.
Gifts of more than minimal value which are accepted
by employees under circumstances described in the
preceding paragraph may not be retained, but
rather become the property of the United States
and must be deposited with the Chief of Protocol
for disposal. It is emphasized that members of
the families of employees are subject to the
same standards and responsibilities under the
Act and regulations as the employees themselves.
A "member of the family and household" is defined
as "a relative by blood, marriage or adoption
who is a resident of the household." An adult
son or daugher, living in his or her own household,
and not individually covered by the Act, would,
thus, not be subject to its recuirements. Even
if a gift is tendered by a foreign government
or foreign official for basically personal, as
opposed to official, reasons, it must be treated
as property of the United States and so deposited.
Under certain circumstances, the Chief of Protocol
may authorize the agency in which the donee is
employed to retain the gift for official use
(such as display in a public room); otherwise, the
Chief of Protocol must forward it to the General
Services Administration for disposal. All gifts
which become property of the Government under
the Act must be handled in this way. All
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employees and family members covered by the law
and regulations must deposit such gifts with
the Chief of Protocol as quickly-as possible.
In view of the importance of the matters described
above, heads of agencies are encouraged to assist
employees in familiarizing themselves with their
individual responsibilities. The Department of
State would be pleased to render further assist-
ance in this effort and will respond to any
inquiries which may be raised.
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. President Ford's Nc:;
Procedures for the Processin'r of Gifts Subject to the
Foreign G?.fts and Decorations Act of 19G6,
and other Gifts from rorcian Sources.
1. All gifts received by or on behalf of the President and his
family are to be delivered to the White House Mail Room or
the Gift Unit upon receipt.
2. The White House Mail Room will:
(a) Assign identity numbers to each item;
(b) For each gift from a foreign source, prepare a pink
card in sextuplicate, containing all pertinent
information about the gift;
(c) Affix identity number to gift item or its container,
and original and all copies of the pin). card;
(d) Send gift, along with original and three copies of
the pink card, to the Gift Unit; and
(e) Retain two copies of the pin]-. card for appropriate
filing in the Mail Room.
3. Gifts received directly by the Gift Unit will be longed in
coordination with the Mail Room, i.e., identity number
assigned by the Mail Room, two copies for the Mail Room
files, etc.
4. Gift Unit will segregate cards and gifts into the followin-
categories:
(a) Gifts clearly worth less than $50.00 (Smithsonian will
make available appraisers where necessary to assist in
this determination);
(b) Gifts over $50.00;
(c) Gifts of jewelry and ot):-r items of great value,
requiring special handling for safekeeping;
(d) Gifts of. consumables and perishables.
I,ollowing this initial segregation, the Gift Unit will
arrange for photographing all gift:: falling into categories
4(b) and (e) .
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5. After segregation, the C:ft Unit will send a copy of each
pink card to the Chief of Protocol for review prior to the
inspection required in 6(b), infra.
6 a. When inmediate use of a gift is anticipated at the time of
its receipt in the Gift Unit, the Gift Unit will prepare a
request for that use which will be promptly sent to the
Chief of Protocol (along with a copy of the pink card) for
his approval. When there is insufficient t4me to request
such approval in writing, telephonic approval may be sought
from the Office of the Chief of Protocol. However, this is
to be followed by a written request and response approving
this use. As soon as practicable, the gift shall be photo-
graphed and a copy sent to the Office of the Chief of Protocol.
These gifts shall be available for inspection by the Chief
of Protocol or his designee. Once this particular official
use has ceased, the Gift Unit shall notify the Office of the
Chief of Protocol in order that the normal procedures for
reporting the item to GSA can be completed (see 6b, infra).
b. Every two weeks the Chief of Protocol or his designee will
visit the Gift Unit to inspect all gifts from foreign
sources (and the pink cards for these gifts) received since
the last inspection (with exception for items described
in 4(d), supra, for which the Gift Unit shall be given
authority to dispose of on receipt (see Attachment A)).
The Chief of Protocol or his designee will examine the
gift and classification tentatively made by the Gift Unit
and will determine and/or concur with the appropriate
classification as to statutory or non-statutory gift,
indicate such on the pink card, and initial and date all
pink cards for gifts from foreign sources.
7. The Gift Unit will prepare a declaration card (furnished by
the Chief of Protocol) on all items determined Lo fall under
the Act and forward the card, with a photograph of the gift
attached, to the thief of Protocol within forty-eight (48)
hours after inF,,,ection.
8. The Chief of Protocol will then prepare a Form 120 reporting
gifts under the Act to the General Services Administration
(GSA) with instructions that they he deposited in the National
Archives for eventual inclusion in a Presidential Library
or other appropriate location as determined by the Archivist,
and authorizing their 'se, in the interim, for display and
other uses consistent with instructions fr-'m the Chief of
Protocol to GSA at the time of reporting (see Attachment B).
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9. Tho Chief of vrutuccl shall forward to the Gift Unit a copy
of the Form 120 which will serve as authorization for the
Gift Unit tG turn over thor-.: rifts list.'d thereon to GSA.
GSA (rational Arc lvc _) in cool eratioin with the Gift Unit
will p'.ck the gifts. Specific procedurc-~ will G)e developed
between Archives and the Gift Unit for the follo':Jing:
(a) inventory of boxes,
(b) standa_0._7atien of box sizes,
(c) packing c,- boxes,
(d) segre?a`ion of items by value,
(e) continuing records maintenance, preparation of receipts
for loaned items and availability for inspection by
th? Chief of Protocol, his designee or the public.
10. If at any time a request is rr,ade tottilize a gift under the
Act in a manner not specified in Attachment ?, the Archivist
must forward th- request to the Chief of Protocol and receive
his written atiproval.
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January 29, 1975
Thank you for the opportunity to review and comment on the draft
GAO report entitled "Proposals to Strengthen the Foreign Gifts
and Decorations Act of 1966. " 1 have limited this review to the
factual portions of the --?eport, and will defer, for the present
'-:me, commenting on the legi'lative proposals that are made
therein.
As a member of my staff has already related to your repres.:ntatives,
of only comment is with respect to the recording process for gifts
that is described on page 7 of the report. Rather than the four cards
d;scussed in the second full paragraph on this page, an original
:.aid and five copies are prepared for each gift received by the
White House. Two copies are maintained in the mail room files,
while the remainder are maintained as described in the report.
I trust that this information has been helpful to ycu. Please do
not hesitate to call upon my off ce should further assibtance be
required.
Sincerely,
Mr. Louis W. Hunter
Associate Director of the
International Division
United States General Accounting Office
Washington, D. C. 20548
GAO Note: Page number references in this avoendix may not
correspond to the pages in this report.
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i
sWIrntiuxiAx INSTInTION
11iilh1i#7/0N.i.C /liSP
I. S.a.
16 January 1975
The Honorable Elmer B. Staats
Comptroller General of the United States
U. S. General Accounting Office
Washington, D. C. 20548
Thank you for sending me a copy of your draft audit
report titled "Proposals to Strengthen the Foreign Gifts
and Decorations Act of 1966."
My review of this report indicates that the comments
on Page 34, as they relate to the Smithsonian, could give
an incorrect impression. The report states that you
selected for audit 30 gifts and found that 27 of thew 30
gifts were exchanged or sold. This gives the impression
that a large percentage of the total gifts acquired by the
Smithsonian (131) were exchanged or sold.
I have been advised that the 30 gifts which you
selected for audit, were acquired by the Smithsonian from
GSA on four transfer orders (OU-282, dated September 22,
1969; OU-841B, dated March 10, 1970; 1U-638, dated March 23,
1971; and 1U-682, dated April 12, 1971). There were 59
gifts acquired on these four transfer orders. The 30 gifts
which you selected for audit all were acquired by the
Smithsonian Department of Mineral Sciences. The other 29
gifts on these four transfer orders were acquired by other
Smithsonian offices.
Only 26 of the 59 gifts acquired on these four orders
were exchanged or sold (all by the Department of Mineral
Sciences). The remaining 33 gifts either are in the National
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Collections, on loan, or otherwise accounted for. Also,
the State Department valued the 59 gifts acquired on
these four transfer orders at $26,789. The value of the
26 gifts exchanged was $4,894.
I believe that the figures I have reported above
give a more representative picture of how the Smithsonian
has used and controlled foreign gifts, as well as the
dollar values involved. We would tike to meet with your
auditors to discuss this matter further.
In 1972, the Smithsonian recognized the need to review
its policy for exchanging foreign gifts. Accordingly, as
you reported, Fa have halted such exchanges.
Sincerely yours,
S. Dillon Ripley
Secretary
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UNITED STATES OF AMERICA
GENERAL SERVICES ADMINISTRATInN
WASHINGTON. DC 20405
Honorable Elmer B. Staats
Comptroller General of the United States
General Accounting Office
Washington, DC 20548
Thank you for the opportunity to review and comment on you drag
report to the Committee on Foreign Relations, United State.,Senaab,
entitled "Proposals to Strengthen the Foreign Gifts and Dect*ations
Act of 1966" which -..an forwarded by your letter of January 6, 1975.
Thank you for your words of encouragement in our efforts to develop
improved methods, procedures, and documentation to ensure more
effective control, acccuntability, and utilization of foreign gifts. We
have prepared a GSA Order (copy attached) which implements the
actions recommended by the GSA Office of Audits, to which you refer
on page 35 of the subject report. We believe that this order will
effectively regulate GSA's responsibilities in the receipt, storage,
and ultimate disposition of foreign gift items. This order has been
coordinated with the Department of State and will be implemented in
the near future.
Under existing procedures, gifts are being forwarded to GSA by the
Chief of Protocol for transfer, donation or other disposal in accordance
with such instructions as may be furnished by that officer. As your
report indicated, it is our view that the Foreign Gifts and Decorations
Act of 1966, as amended, provides independent disposal authority to
the President and by delegation, to the State Department. The present
procedures provide that after the property has been screened for
Federal needs, it may be n'.ade available for donation to public museums.
If the property is not transferred to a Federal agency or donated to a
public museum, it may be held indefinitely or offered for sale. We
believe that if legislation is considered necessary, Congress should
address the question of whether a sale should be made under a public
offering or whether a negotiated tale would better serve the overall
interest of the United States.
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While GAO has raised the question concerning the latitude of the authority
of the President in the disposal of foreign gifts, and while foreign policy
is a matter outside the purview of the General Services Administration, we
believe that public sales aimed at generating the highest proceeds may be
inappropriate in this area. if statutory changes are to be made in the act,
we recommend that authority to negot'ate be specifically provided under
such circumstances as the Congress rr ay deem appropriate, including
negotiations with recipients subject to appraisal and appropriate safeguards.
We believe it can be validly argued that if the acceptance of a gift is
necessary so as to not offend a foreign state, Then a public sale of such a
gift may be equally offensive. Also, the statute should authorize donating
to public museums consistent with the program now under existence
pursuant to instructions of the Chief of Protocol.
With respect to other aspects of any proposed legislation, we would
suggest a definition of "items of minimal value. " This definition should
stat> whether the dollar amo?int applies to wholesale or retail value and
whether it relates to the value at purchase or to the present replacement
,;slue in the United States.
We are confident that the actions we are taking will provide GSA with
greater control over the disposition of foreign gift items.
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January 29, 1)75
Mr. J. Kenneth Fasick
Director
International Division
U.S. General Accounting Office
Washington, D. C. 2054b
I am replying to your letter of January 6, 1975,
which forwarded copies of the Draft Report:
"Proposals to Strengthen the Foreign Gifts and
Decorations Act of 1966" and requested the
Department's comments.
The enclosed comments have been prepared by the
Chief of Protocol, Ambassador Catto.
We appreciate having had the opportunity to review
and comment upon the draft report.
Sir)cerely yours,
1(. . ~ ... CI , \ / 1- - 1 hhG~1
1 ~Vr1(X/(A. 1 I ?w--
Richard W. Murray
Deputy Assistant Secreta
for Budget and Finance
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Department of State Comments on GAO Draft Report
"Proposals to Strengthen the Foreign Gifts
and Decorations Act of 1966"
The Department of State finds this draft report to be a
comprehensive and useful review of the admi.listrotion
of the Act and its attendant problems insofar as it
concerns the Department's role and functions. The fol-
lowing comments are basically factual, since the De-
partment prefers not to comment on the substantive changes
in the Act recommended for the Congress' consideration
until such time as draft legislation may be prepared and
circulated for agency comments.
Preliminarily, the Department would like to make general
comments on two issues which are ?.aised at several points
in the report. The first of th--se concerns sanctions for
violations of the Act. The Department believes that the
statute and implementing regulations make it clear that
gifts of over $50 value at retail in the United States,
as determined by the recipient, become U.S. property at
the moment of their acceptance. As U.S. property, such
gif'-s are covered by various laws and regulations related
to the control, use, and the disposal of Federal property.
For the most part, these laws and regulations, including
the 1966 Gift Act, make each employee individually re-
sponsible for his actions relating to Federal property.
Executive Order 11222 concerning employee conduct suc-
cinctly states an essential premise as follows: "An em-
ployee shall not use Federal property of any kind other
than for officially approved activities. He must protect
and conserve all Federal property, including equipment
and supplies entrusted or issued to him." (Sec. 204)
There are criminal, civil, and administra`ive sanctions
attached to improper control, misuse, or conversion of
Federal property; under appropriate circumstances, the
Executive Branch, and particularly the Justice Department
has the authority to investigate and prosecute individu-
als believed to have failed to :omply with this statute.
While a specific reference in any new legislation as to
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APPENDIX IV
the applicability of these sanctions to violations of
the G?fts Act would be helpful, it would be incorrect,
in our opinion, to conclude that the present: statute is
without sanctions.
The second general comment concerns investigations of
possible violations of the Act by the Chief of Protocol.
At several points in the GAO report, comments are made
concerning what the Chief of Protocol and the Department
of State could or should have done to investigate or re-
cover property covered by the statute. The Department
finds that neither the Act nor the implementing regula-
tions confer any investigative, recovery, or enforcement
powers on either the Secretary of State or the Chief of
Protocol. The role of the Department and the Chief of
Protocol is that of receiving U.S. property deposited by
persons complying with the statute and regulations. The
Department does not view its role as being e.panded in
any way by either inference or other general agency re-
sponsibilities beyond the limited functions set forth in
the statute and implementing regulations. Further, we be-
lieve that any such investigative functions as envisioned
by the GAO report should be the responsibility of the
Justice Department or other agency normally charged with
such enforcement functions. The Chief of Protocol has
neither the authority, staff, nor competence to perform
investigations and enforcement of the statute; indeed such
functions would be wholly out of character for the Office
of Protocol. The Department of State would, however, like
to see provisions for enforcement of the statute specifi-
cally included in any revised legislation as recommended
by the GAO report.
-- Page v and Page 24: GAO comment that regulations
fail to explain that all gifts given by foreign government
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officials, whether or not a state gift or personal gift,
are covered by the Gifts Act is gratuitous in view of
the language of the Act itself and past practice in im-
plementing it.
-- Page v and Page 20: The recommerdation that there
be an independent appraisal of Foreign gifts, :f accepted,
would create a variety of new problems: who would per-
form the appraisal, where, and at whose expense? Would
several appraisals be required for certain art works? A
potentially heavy administrative burden as well as a new
expense might be created by such a requirement. It would
be useful to have included it the report the GAO views on
how best to handle or fund such an appraisal system.
-- Page ix: It is unclear what public disclosure re-
quirements respecting gifts and their appraisal are en-
visioned. State has already taken the positicn that
records relating to acceptance and disposition of foreign
gifts are accessible to the public under the Freedom of
Information Act. What purpose would be served by requiring
mandatory publication of the appraisal of all gifts?
-- Page ix and 20: Although "multinational organiza-
tions" are not specifically included in the statute, any
gift made by them could be considered as a foreign gift
under the statute because of the nature of the organiza-
tion or because of the function that organization serves
in making the gift as the agent of a foreign government.
Contrary to the statement on page 20, the Offic- of
Protocol is not aware of having made such an interpreta-
tion in concrete cases.
-- Page 2, 3, and 28: The suggestion that the setting
of "minimal value" be transferred from the regulations to
the statute and raised from $50 to $100 is not one which
the Department feels is in accordance with the intent of
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a
Congress, as expressed in the Committee Report on the
1966 legislation. Unless the Congress now has a dif-
ferent view, the Department feels that inflation has
actually helped to bring the regulation $50 limit more
in keeping with the spirit of the legislative intent,
which was to authorize the retention of "small things,
trivial things, marks of courtesy and respect."
If the limit were to be raised to $100, it would be a
fundamental change in the purpose and character of the
legislation. Further, inclusion of a specific dollar
amount in the statute would require legislative action
rather than simpler admin3.strative action to adjust the
dollar amount, should any further change be required as
a result of either inflation or deflation.
-- Page 6: The GAO conclusion that the regulation
on the deposit of foreign gifts with the Chief of Proto-
col merely sets forth internal government procedures
and is not for the purpose of protecting U.S. Govern-
ment (property; interests is inappropriate given the
focus of the G.fts Act. In the Department's view,
establishment of a uniform and centralized system for
processing those foreign gifts which must be accepted
under special circumstances was a key aim of the legis-
lation. The Department strongly disagrees that variance
with that procedure may not lead to failure to comply
with the Act's requirements. Inclusion in the GAO re-
port of the present language could lead to the inference
that alternate nodes of depositing or handling foreign
gifts--at the option of the donee--are permissible and
in compliance with the Act.
-- Page 13: Although the GAO comment that U.S. mis-
sions in ten countries had no system for reporting gifts
made to mission employees is correct, this is due to the
absence of a statutory and regulatory authorization to
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U.S. missions to report the gifts received by its em-
ployees or other U.S. officials traveling abroad. It
is noted in this regard, however, that all U.S. mis-
sions were sent the July 1, 1974, memorandum to all
employees on their obligations under the Foreign Gifts
and Decorations Act, and heads were encouraged at that
time to acquaint their personnel and official visitors
with the contents of the memorandum and the require-
ments of the law.
-- Page 18: (a) Definitive procedures have already
been developed by the Office of Protocol for handling
gifts received by the First Family, the Vice President,
the Secretary of State, and members of their families.
These procedures are unique in that they deal with
persons in high office, who tend to receive large num-
bers of gifts; however, these individuals have the same
obligation as all other Government employees to report
the gifts which they receive while Government employees.
(b) Neither Federal agencies nor U.S. missions have
the obligation to report gifts received by their em-
ployees and no such obligation should be imposed upon
them other than to acquaint employees with their in-
dividual obligations.
(c) The Chief of Protocol should not be burdened with
the obligation to disclose to the public gifts which
have been reported to him, nor should he bear the addi-
tional burden of requesting any formal periodic account-
ing of gifts received by the Vice President and the
Secretary of State. Existing procedures are sufficient
to satisfy such a requirement, and the records of the
Chief of Protocol respecting foreign gifts which have
been reported to him are open to the public. Further,
the Act confers no investigative powers upon the Chief
of Protocol, and he is not authorized to make such de-
mands either upon agencies or individual employees.
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-- Page 19: The basis upon which Protocol asserts
its inability to police the Act is entirely unrelated
to any positions which the individual gift recipients
may hold. Regardless of the status of the individuals
involved, the Protocol Office has no specific or gen-
eral authority to compel compliance with the Act, which
as of now remains an individual responsibility.
-- Page 21: The criticism of the Office of Protocol
respecting the action that it could have taken ignores
the basic consideration in this area--namely, the total
absence of enforcement and compliance authority. The
Office of Protocol has carried out its delegated func-
tions under the Act, and could not have taken any action
respecting individual donees or agencies which would
have led to broader compliance with the Act.
Any reticence on -:he part of the Office of Proto-
col in advising the Congi-~ss of difficulties encountered
in administering the Act stemmed from its inability to
effect compliance in a general way, rather than its
sensitivity toward individual donees who may or may not
have reported gifts.
-- Page 20: See also comments on Page v and Page ix.
-- Page 22: With regard to the comment on the reten-
tion of records made on trips abroad, it should be noted
that these records are prepared to assist an individual
in identifying and acknowledging gifts. There is no
statutory or'regulatory obligation imposed on the State
Department and the Office of Protocol to use the infor-
mation contained on such sheets for the purpose of en-
forcing provisions of the Act. It is the recipient of
the gift who must make a determination of its value and
act in accordance with the regulations.
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-- Page 24: See comments on page v.
-- Page 25, 26, and 27: The exact basis for the cate-
gorical legal conclusion by the "AO that the Foreign
Gifts Act does not apply to intangible items is unclear.
-- Page 27: The Department is unaware of what more
detailed guidance could be provided to Federal agencies
GAO note: Comments deleted referred to material which was ^mn'_tted
from the final report.
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in addition to factual data already provided them, un-
less the present statute or regulations were amended
or modified.
(Comments deleted refers to material which was omitted
from the final report.)
(GAO Note: refer to prior comments)
-- Page 28: See comments on page 2 - 3.
-- Page 36: With regard to control by the Chief of
Protocol over items permitted to be retained by an
agency for official use, it seems clear that in any ef-
fective property control and inventory system responsi-
bility for property must rest with the user possessing
physical control of an item. In the past it appears
that t=ie Office of Protocol has not made it clear to an
agency requesting retention of property for official
use that such property should be controlled and accounted
for at all ti=les like other Federal. property within the
agency's jurisdiction. New criteria have been developed
for passing upon such agency requests, and subsequent
correspondence with agencies will state agency responsi-
bilitie3 concerning the safeguarding of this property.
-- Page 39: The GAO comment concerning the desira-
bility of reducing the admi:ii,trative burden of processing
routine decorations requests is an excellent one. As the
report recommends, a review of recurring requests will be
undertaken with a view to providing blanket concurrence
where it is determined to be appropriate.
H4rTry F1 A (aloW. -.lr
Chief ? Protocol D
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A BILL
To amend and improve 5 U.S.C. ?7342 (Public Law 90-83).
Be it enacted by the Senate and House of Representatives
of the United States of America in Congress assembled,
Zhat 5 U.S.C. ?7342 (Public Law 90-83) is hereby repealed and
the following new section is substituted therefor:
?7342. Receipt and disposition of foreign gifts and decorations.
(a) For the purpose of this section--
(1) "employee" means--
(A) an employee as defined by section 2105
of this title;
(B) an expert or consultant while under
contract with the United States or any agency,
department, or establishmcnt thereof pursuant
to section 3109 of this title;
(C) an individual employed hv1 nr occupying
C-~ t- I " C I ~ 7
an office or position in, the government of a
territory or possession of the United Stites or
the District of Columbia;
(D) a member of a uniformed service;
(E) the President;
(E) a Member of Congress as defined by
section 2106 of this title; and
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(G) a member of the family and household
of an individual described in subparagraphs
(A)-(F) of this paragraph; 1/
(2) "foreign government" means--
(A) all units of foreign governmental
authority, including foreign national, state,
local, and municipal governments;
(B) international and multinational organi-
zations whose membership is composed, in whole
or in part, of foreign governments as defined in
subparagraph (A) of this paragraph; 2/ and
(C) an agent or representatives of a
foreign government as defined in subparagraph
(A) and (B) cf this paragraph, whether acting
in an official or private capacity;
(3) "gift" means a present or thing, other than
a decoration, tendered by or received from a foreign
governmenb;
(4) "decoration" means an order, device, medal,
badge, insignia, or emblem tendered by or received
from a foreign government;
1/ This provision would re-enact subsection (a)(l)(F)
of the existing Act. For discussion of problems
created by this provision and the countervailing
considerations, see p. 16 of this report.
2/ It is unclear under the existing Act whether gifts
from such organizations are subject to the Act.
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(5) "minimal value" means a retail value at
time of acceptance not in excess of $100 in the United
States; provided that every three years from the date
of enactment of this section, "minimal vrlue" shall be
redefined in regulations prescribed by the President
or his delegate to reflect changes in the consumer
price index for the prior three-year period; provided
Further that regulations of agencies, offices, and
other entities may define "minimal value" for their
employees to be less than the value prescribed under
this paragraph;
(6) "appropriate agency of the .overnment" means
the President or his delegate for executive branch em-
ployees, the Committee on official Conduct for Members
and employees of the House of Representatives the
Senate Select Committee on Standards and Conduct for
Senators and all other legislative branch employees,
and the Administrative Office of the U.S. Courts for
judicial branch employees.
(b) An employee may not request or otherwise encourage
the tender of a gift or decoration.
(c) (1) Congress consents to--
(A) the accepting and retaining by on employee
of a gift of minimal value tendered or received as a
souvenir or mark of courtesy; and
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(B) the accepting by an employee of a gift of
more than minimal value when it appears that to refuse
the gift would likely cause offense or embarrassment
or otherwise adversely affect the foreign relations of
the United States; provided, however, that a gift of
more than minimal value is deemed to have been accepted
on behalf of the United States and, upon acceptance,
shall become the property of the United States; pro-
vided further, that an employee may accept gifts of
travel expenses such as transportation, food, and
lodging of more than minimal value from a foreign
government only when on official business and where
(1) the expenses would otherwise be reimbursible '.,y
the United Stat,?s; (2) where it is determined that.
circumstances and conditions make acceptance of such
expenses necessary; and (3) the official nature of
the business and the existence of such circumstances
and conditions is certified by
for the legislative branch,
for the judicial branch, or the agency head and the
Secretary of State for the executive branch, as
appropriate. The Secretary of State in consultation
with shall promulgate uniform
guidelines for the use of the Government to implement
this proviso.
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(2) k ithin 60 days of acceptance of a gift of
.jo-e than minimal value, the donee shall--
(A) deposit the gift for disposal with
the appropriate agency of the Government; or
(f;) subject to the approval of the agency,
office or entity in which the donee is employed
and the concurrence of the appropriate agency
of the Government, deposit the gift for official
use with the agency, office or entity in which
the aonee is employed. Within 30 days of termi-
nation of the official use, the agency, otfice
or other entity that has retained the gift for
official use shall deposit the gift for disposal
with the appropriate agency of the Government.
(3) When a donee deposits a gift of more than
minimal value for disposal or for official use under
subsection (c)(2), or within 30 days of acceptance of
travel expenses as provided in subsection (c)(1)(B),
the donee shall file a statement with the appropriate
ager.y of the Government containing the intormation
prescribed in subsection (f) of this section for that
gift.
(d) Congress consents to the accepting, retaining,
and wearing by an employee of a decoration tendered in
recognition of active tield service in time of combat
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operations or awarded for other outstanding or unusually
meritorious performance, subject to the approval of the
agency, office or other entity in which the employee is
employed and the concurrence of the Secretary of State.
Without this approval and concurrence, the decoration is
deemed to have been accepted on behalf of the United
States, shall become the property of the United States,
and shall be deposited by the donee, within 60 days of
acceptance, with the appropriate agency of the Government
for official use or disposal.
(e) Gifts and decorations that have been deposited
with the appropriate agency of the Government for disposal
shall be transferred, donated or otherwise disposed of in
accordance with the Federal Property and Administrative
Services Act of 1949 (63 Stat. 377). However, no gift
or decoration that has been deposited for disposal shah
be sold except through a negotiated sale approved by the
Secretary of State or iris deiegaLe after determining that
the sale will not adversely affect the foreign relations
of the United States. 3/
3/ If enacted, subsection (e) would reverse the view of
the State Department and General Services Adminis-
tration that the Foreign Gifts and Decorations Act
contains an independent grant of authority to dispose
of U.S. property. If not enacted, Congress may con-
sider placing some restrictions on the types of dis-
position that the appropriate agency of the Government
may authorize, such as sales at public auctions.
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(f) As soon as practicable after December 31 of a
calendar year, the appropriate agency of the Government
shall compile a listing of all statments filed in accordar:ce
with subsection (c)(3). The listing shall include the
following information for each gift reported:
(1) the name and position of the employee;
(2) a brief description of each gift accepted;
(3) the foraign government and the name and
position of the individual who presented each gift;
(4) the date of acceptance of each gift;
(5) the estimated retail value in the United
States of each gift at the time of acceptance; and
(6) disposition or current location.
The appropriate agency of the Government shall cause the
listing to be published in the Federal Register not later
than January 31 of the succeeding calendar year.
(g) (1) The appropriate agencies of the Government
may prescribe joint regulations to carry out the
purpose of this section. These regulations shall be
implemented by each of the appropriate agencies of
the Government for their employees.
(2) The appropriate agency of the Government
shall document cases in which there is reason to
believe that an employee has violated this section
and refer such cases to the Department of. Justice or
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other appropriate officials; obtain an independent
appraisal of gifts when necessary; and take other
similar actions necessary to carry out the purpose
of this section.
(h) (1) Any employee who fails to deposit a gift
of more than minimal value as required under sub-
sections (c)(2)(A) or (B) of this section shall, upon
conviction, be punished by a fine of not more than
$1,000 or by imprisonment for not more than twelve
months, or by both such fine and imprisonment.
(2) The penalty authorized in 18 U.S.C. S641
far unlawfully converting property of the United
States shall apply to the unlawful retention of gifts
of more than minimal value.
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PRINCIPAL OFFICIALS OF THE DEPARTMENT
OF STATE RESPONSIBLE FOR ADMINISTERING ACTIVITIES
DISCUSSED IN THIS REPORT
Tenure of office
Prom _
~_ To
SECRETARY OF STATE:
Henry A. Kissinger
Sept.
1973
Present
William P. Rogers
Jan.
1969
Sept. 1973
Dean Rusk
Jan.
1961
Jan. 1969
CHIEF OF PROTOCOL:
Henry E. Catto, Jr.
Apr.
1974
Present
Marion H. Smoak
Mar.
1974
Mar.
1974
Marion H. Smoak (Acting)
Ju:.
1972
Mar.
1974
Emil Mosbacher, Jr.
Jan.
1969
Jun.
1972
Tyler Able
Sept.
1963
Jan.
1969
Angier Biddle Duke
Apr.
1968
Sept.
1968
James w. Symington
Mar.
1966
Mar.
1968
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