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HomeMy WebLinkAbout1609 Krull In Re: Mark Krull, : File Docket: 11-017 Respondent : X-ref: Order No. 1609 : Date Decided: 9/24/12 : Date Mailed: 10/9/12 Before: John J. Bolger, Chair Donald M. McCurdy, Vice Chair Raquel K. Bergen Nicholas A. Colafella Mark Volk Mark R. Corrigan This is a final adjudication of the State Ethics Commission. Procedurally, the Investigative Division of the State Ethics Commission conducted an investigation regarding possible violation(s) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., by the above-named Respondent. At the commencement of its investigation, the Investigative Division served upon Respondent written notice of the specific allegations. Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an “Investigative Complaint.” An Answer was filed and a hearing was requested. A Stipulation of Findings and a Consent Agreement were subsequently submitted by the parties to the Commission for consideration. The Stipulated Findings are set forth as the Findings in this Order. The Consent Agreement has been approved. I.ALLEGATIONS: That Mark Krull, a public official/public employee in his capacity as an Income Maintenance Caseworker for the Department of Public Welfare, violated Sections 1103(a) and 1104(a) of the State Ethics Act (Act 93 of 1998), 65 Pa.C.S. §§ 1103(a) and 1104(a), when he used the authority of his public position and/or confidential information obtained through his public position for the private pecuniary benefit of himself and/or a private business with which he is associated to contact and contract, in a private capacity, with applicants/clients of DPW seeking Social Security Disability (SSD) and Social Security Income (SSI) benefits; and when he used the authority of his public position and/or confidential information obtained through his public position in an attempt to contract, in a private capacity, with applicants/clients of DPW seeking SSD and SSI benefits; when he used the facilities and equipment and supplies of the Department of Public Welfare in furtherance of his private business interest; and when he failed to file Statements of Financial Interests for the 2006, 2007, 2008, 2009 and 2010 calendar years. II.FINDINGS: 1. Mark Krull was employed by the Pennsylvania Department of Public Welfare (hereafter “DPW”) from approximately January 11, 1982, to June 29, 2011. a. Krull served as a DPW Income Maintenance Caseworker (job classification #44720) from approximately January 11, 1982, to June 29, 2011. Krull, 11-017 Page 2 1. Krull was transferred to the Disability Advocate Program (hereafter “DAP”) division of DPW on February 7, 2005. 2. Krull was commonly referred to as a DPW DAP Caseworker/Advocate from February 7, 2005, to June 29, 2011. 3. Krull, as a DPW DAP Caseworker/Advocate, maintained job classification #44720. b. Krull retired from DPW effective June 30, 2011. 2. The Position Description for Krull, certified by Krull on June 10, 2008, provided, in part, the following purpose and description of duties: a. Position Purpose: Provide services to help recipients with disabilities through Supplemental Security Income (SSI) or Social Security Disability Income (SSDI) application and appeal process. Determines eligibility for LIHEAP. b. Description of Duties:  Determines appropriateness of referrals  Process referrals from other agencies  Monitor client progress through SSI/SSDI application and appeal process  Manage a DAP caseload  Participates in evaluations and development of service plans  Procure and evaluate additional medical information as the basis for decisions by Medical Review Team (MRT), Adjudication Administrative Law Judges and Appeals Council.  May perform other DAP functions such as: counsel clients on benefits of obtaining counsel, represent clients at SSA, testify and/or represent clients at ALJ hearings. 3. DAP is a social service program that was established by DPW in 1985 to assist DPW clients with disabilities through the Supplemental Security Income (“SSI”) and Social Security Disability Insurance (“SSDI”) application and appeal process. a. SSI and SSDI are federally funded programs that are administered and regulated by the Social Security Administration (“SSA”). 1. SSI is a federally funded program designed to assist aged, blind, and disabled individuals who have little or no income. 2. SSDI is a federally funded program designed to provide income supplements to individuals who are physically restricted in their ability to be employed. 4. DPW clients with disabilities who are recipients of cash assistance, Medicaid, and/or food stamps are referred to a DAP Caseworker/Advocate by DPW County Assistance Office eligibility workers. a. Referrals may also be provided by other agencies, including but not limited to the Mental Health Base Service Unit or SSA. 5. Procedures regarding the DAP are detailed in the DPW Supplemental Handbook, Chapter 820, Disability Advocacy Program. Krull, 11-017 Page 3 a. During interviews with DPW clients, DAP Caseworkers/Advocates are to perform the following duties: 1. Explain their role in the process of assisting the DPW client. 2. Provide a DAP Contact Card to the DPW client. 3. Emphasize the benefits related to a DPW client receiving SSI and/or SSDI. 4. Inform the DPW client that he/she may appoint the DAP Caseworker/Advocate as their representative. 5. Assess the DPW client’s capabilities and determine if any family, friends, or other social service agency personnel are available to assist the DPW client with his/her SSI and/or SSDI application. 6. Generate notes/records to develop social, medical, and employment histories related to DPW clients. 6. An Appointment of Representative Form (SSA 1696 form) must be completed if the DPW client selects the DAP Caseworker/Advocate as his/her non-attorney representative. a. The completion of the SSA 1696 form authorizes the DAP Caseworker/Advocate as the client’s appointed non-attorney representative in matters related to the client’s claim with SSA. b. DPW procedures require the DAP Caseworker/Advocate to complete the waiver of fee section of the SSA 1696 form to waive the right to charge and collect a fee for his/her representative services. 7. Pursuant to the DAP procedures, the DAP Caseworker/Advocate is to perform the following during the SSI/SSDI application process to identify the specific disability or disabilities: a. Assist the DPW client in any interviews with SSA workers. b. Assist the DPW client in completing the SSI/SSDI application (if necessary). c. Assist the DPW client in completing the Appointment of Representative Form (SSA form 1696) if not already completed. d. Update the DAP Client Tracking and Reporting System. e. Schedule follow-up appointments with DPW clients as needed to compile medical documentation, attend consultative appointments, etc. 8. SSA either approves or denies the client for SSI/SSDI following submission of an application. a. If SSA approves the DPW client for SSI/SSDI the DAP Caseworker/Advocate is to: 1. Update the DAP Client Tracking and Reporting System. Krull, 11-017 Page 4 2. Notify the CAO (County Assistance Office) eligibility worker of the DPW client’s approved status by completing the DPW PA 731 form. b. If SSA denies the DPW client for SSI/SSDI the DAP Caseworker/Advocate is to: 1. Interview the DPW client and discuss the SSI/SSDI appeal process. 2. Advise the DPW client of his/her right to have either the DAP Caseworker/Advocate or an attorney represent him/her at his/her appeal. 3. Provide DPW clients with the DPW approved Attorney Listing and assist DPW clients in obtaining an attorney if desired. 4. Complete the Request for Hearing form, the Authorization to Disclose Information to the SSA form and the Disability Report-Appeal form. 9. If the client does not have a non-DAP representative, the DAP Caseworker/Advocate’s role during the appeal process is as follows: a. Contact SSA to obtain copies of consultative examination reports, Social Security denial letters, and justifications. b. If needed, seek advice as to whether to pursue an appeal by forwarding the SSA information and the DAP file to MRT (Medical Review Team) for review and recommendation. c. If requested, assist the client’s attorney to prepare for an Administrative Law Judge hearing. 10. The Administrative Law Judge is an SSA official/attorney who conducts the first step in the appeal process by conducting a face-to-face hearing with the DPW client and his/her representative. a. A DAP Caseworker/Advocate testifying on behalf of the DPW client was rare and would usually occur by written testimony and even then only if the client was represented by an attorney. b. A DAP Caseworker/Advocate cannot testify on behalf of the DPW client if the Caseworker/Advocate is designated as the DPW client’s representative. c. Documentation can be provided to support the disability claim if requested by the Administrative Law Judge or the DAP Caseworker/Advocate determines it to be beneficial to the case. 11. The Administrative Law Judge then makes the determination to grant or deny SSI/SSDI for the DPW client. a. If the Administrative Law Judge approves the SSI/SSDI for the DPW client, the DAP Caseworker/Advocate is to: 1. Update the DAP Client Tracking and Reporting System. 2. Notify the CAO worker of the outcome of the hearing by completing DPW form PA 731. Krull, 11-017 Page 5 b. If the Administrative Law Judge denies the applicant DPW client SSI/SSDI, the applicant’s DAP Caseworker/Advocate and/or the attorney may review all of the evidence to determine if an appeal to the Appeals Council is warranted. 1. The Appeals Council is a review unit of the SSA which reviews the decisions of the Administrative Law Judge. 2. The Appeals Council’s decision can be appealed by the DAP Caseworker/Advocate to the US District Court. 12. Krull, in his position as a DAP Caseworker/Advocate, had access to DPW client information. a. DPW client information is confidential and to be used only for DPW business. 13. SSA guidelines provide that representatives (whether they are attorneys or non- attorneys) who have successfully represented clients with disabilities through the SSI/SSDI application and appeal process can collect a fee from their clients for services provided. a. The permissible fee can total no more than 25% of past due benefits or $6,000.00 (whichever is less). b. DPW DAP Caseworkers/Advocates representing clients through the hearing process are ineligible to receive this fee. 1. The DAP Caseworker Advocate completes the waiver of fee section of the SSA 1696 form. c. Any fees must be approved by the Administrative Law Judge. 14. Krull has been an enrolled member of SSA’s Direct Payment to Non-Attorney Representatives Program (hereafter “NRP”) since January/February of 2009. a. The program permanently extended the authority to withhold 25% of past- due benefits and directly pay any authorized fees to eligible non-attorney representatives under Titles II and XVI of the SSA. 1. Previous to the enactment of NRP only attorney representatives were able to receive a direct pay authorized by SSA as a result of favorable decisions. 2. Individuals enrolled in NRP who have received direct payments are issued a 1099 MISC IRS composite form from SSA at the conclusion of each year. b. Non-attorney representatives who are not enrolled in the SSA’s NRP can obtain payment directly from their clients instead of from SSA, only if authorized by an Administrative Law Judge. 15. As a non-attorney representative, Krull fulfilled the following requirements to be enrolled in SSA’s NRP: Krull, 11-017 Page 6 a. Have a bachelor’s degree from an accredited institution of higher education or at least four years of relevant professional experience and either a high school diploma or General Education Development (“GED”) certificate; b. Pass a written examination developed and administered by the SSA which tests the knowledge of the relevant provisions of the Act and the most recent developments in SSA and court decisions affecting Titles II and XVI of the Act; c. Secure and maintain continuous professional liability insurance or equivalent insurance; d. Undergo a criminal background check; and e. Demonstrate ongoing completion of qualified courses of continuing education including education regarding ethics and professional conduct, which are designed to enhance professional knowledge in matters related to entitlement to, or eligibility for, benefits based on disability under Titles II and XVI of the Act. 16. Krull was considered a non-attorney representative while representing DPW clients in his official capacity as a DPW DAP Caseworker/Advocate. a. Krull, as a DAP Caseworker/Advocate, was not permitted to receive any fees per SSA guidelines for his representation of DPW clients as their non- attorney representative due to the completion of the waiver of fee section on SSA form 1696. b. DPW policies outlined in Chapter 820 of the DAP prohibited DAP Caseworkers/Advocates from collecting fees for representing clients. c. DPW did not require DAP Caseworkers/Advocates to be enrolled in SSA’s NRP. 1. DPW did not have any policies in place that prohibited Krull from becoming a member of SSA’s NRP. 2. Krull’s enrollment in NRP provided Krull the opportunity to obtain direct fee payments from SSA rather than from clients. 3. Krull never received payment(s) from any clients. 17. Krull has been a registered member in the National Organization of Social Security Claimants’ Representatives (hereafter “NOSSCR”) since on or about April 18, 2010. a. NOSSCR was established in 1979 to provide attorney and non-attorney representatives of SSI/SSDI claimants with information related to successfully representing their claimants. b. Krull as a DAP Caseworker/Advocate was not required by DPW to be enrolled in NOSSCR. c. Krull’s enrollment in NOSSCR served a dual purpose by benefiting Krull with knowledge that could be used in his capacity as both a DPW DAP Caseworker/Advocate and a private non-attorney Disability Advocate. 1. Krull personally paid for his enrollment/membership with NOSSCR. Krull, 11-017 Page 7 18. Krull’s enrollment in SSA’s NRP and membership with NOSSCR occurred during a time when Krull was contemplating retirement from DPW to pursue a career as a private non-attorney Disability Advocate. 19. Krull took annual leave from May 12, 2010, through May 14, 2010, to attend the nd 62 National NOSSCR Conference in New Orleans, Louisiana. a. The conference occurred from May 12, 2010, through May 15, 2010. 1. Krull obtained information/training to assist his career as both a DPW DAP Caseworker/Advocate and a future private non-attorney Disability Advocate. 20. From as early as August 2010 Krull considered receiving payments from his DPW clientele as their private non-attorney representative. a. Krull emailed Nancy Shor, Executive Director, NOSSCR, on August 2, 2010, to determine steps required in order to receive compensation from DPW clients he intended to represent in a private capacity. 21. Krull identified himself, in his email to Nancy Shor, as a non-attorney disability advocate representative participating in the NRP for an “organization.” a. Krull did not inform Shor that he was employed by the Commonwealth of Pennsylvania/DPW. b. Krull indicated that he planned to retire in the near future from DPW with the intention to continue to represent the clientele he established at DPW. c. Krull informed Shor that he had waived the receipt of any fees to be paid to him by his DPW clients for his representation during the time period that he represented said clients through the unidentified “organization.” 1. Krull indicated that he waived the fees by completing the appropriate section of the Appointment of Representative form (SSA form 1696). d. Krull explained that most of his clients’ cases would not be adjudicated at the time of his retirement. e. Krull specifically inquired if he could re-submit the Appointment of Representative forms for those DPW clients that he planned to represent after his retirement with the expectation to receive payment. 22. Krull did not receive a response from Shor and/or NOSSCR. 23. On or about June 17, 2011, Krull sent an email to his supervisor, Francis Rectenwald, to inform Rectenwald about his intentions of retiring from DPW. a. Rectenwald responded to Krull’s email informing Krull to submit a formal notice of retirement to Patricia Steinkopf, Southern District Director, DPW. 24. By the time Krull informed Rectenwald of his plan to retire, Krull had already devised a business plan to establish a home-based sole proprietorship that provided non-attorney disability advocacy services. a. Krull named his business Krull and Associates, LLC. Krull, 11-017 Page 8 1. Krull did not register the business with the Pennsylvania Corporation Bureau nor did he file any Articles of Incorporation. b. Krull’s business plan to generate clientele included having DPW colleagues refer DPW clients to Krull and Associates, LLC and by independently soliciting his own DPW clients. 1. While Krull had not implemented any other method of generating clientele, he had planned to do outreach beyond DPW clients. 25. DPW clients contacted by Krull indicated that Krull spoke to them about his possible private representation of them after his retirement. a. These contacts occurred between January and June 2011. b. Krull made his DPW clients aware of his intimate knowledge of their cases. 26. Krull discussed his fee with his DPW clients who verbally agreed to utilize Krull as their private non-attorney representative. a. Persons were told that would be the fee if Krull successfully represented them, not to exceed twenty-five percent. b. Krull’s clients were unsure if payment to Krull was required if they did not receive favorable outcomes in their cases. 1. Krull advised all potential clients that any fee would be contingent and would require the approval of an Administrative Law Judge. 27. On or about June 22, 2011, Krull issued a formal notice of retirement to Steinkopf notifying DPW of his plan to begin his retirement on June 30, 2011. a. Krull also made his DPW colleagues aware of his plan to retire during the week of June 20, 2011. 1. Krull indicated to his colleagues that he was planning to begin his own disability advocate business in the near future to assist individuals through the SSI/SSDI application/appeals process. 2. Krull advised of his willingness to be referred DPW clients to his business. 28. On or about June 24, 2011, Krull received a letter from Laura Macie-Nagy, Allegheny County Assistance Office Human Resources Department Director, DPW, [indicating] that Krull’s retirement had been accepted by DPW. a. Krull’s final date of employment was scheduled for June 29, 2011. 29. On Friday, June 24, 2011, Rectenwald directed Krull to generate a contact letter to a number of DPW clients identified by Rectenwald who might be eligible for DAP assistance. a. DPW utilizes a form letter to notify clients of such services. 1. Although a standard form letter can be used, Krull’s first approach was to phone clients and provide the advice as to available services. Krull, 11-017 Page 9 30. The content of the letter generated by Krull was altered to include information that Krull would be available, in a private capacity, to assist clients with DAP. Krull’s alteration included the following: Important Note: June 29, 2011 will be my last day working as a Disability Advocate. However, beginning June 30, 2011 I will begin working privately with clients who wish to apply for SSA Disability benefits, doing all the things listed above as well as to present cases at SSA ALJ hearings. If you’d like help with your claim please let me know at the “other” phone listed below. 31. The concluding paragraph was added by Krull with the intent to generate clientele for Krull and Associates, LLC. a. The “other” phone number listed on the correspondence was the business telephone number for Krull and Associates, LLC. 32. Krull only had access to the DPW clients eligible for DAP assistance as a result of his employment as a DPW Income Maintenance Caseworker. a. The client information was personal and confidential and not available to the public. 33. Krull prepared the contact letter throughout the course of his normal work hours. 34. On June 24, 2011, Beth Mikus, Income Maintenance Caseworker Supervisor, DPW, observed correspondence on her desk authored by Krull. a. This letter appeared to resemble a standard DPW correspondence issued to DPW clients. b. Mikus further noticed that at the end of the letter, additional information related to Krull’s private business interests after retirement from DPW was added. 35. Mikus immediately showed the letter to her supervisor, Susan Kretz, DPW Income Maintenance Administrator, due to the nature of the information in Krull’s letter related to Krull’s private endeavors. a. Kretz reviewed the letter and informed Mikus that she also received a copy of the letter. b. Kretz attempted to reach her immediate supervisor, Bea Cleath, Manager, Southern District Office, DPW, about the situation but was unsuccessful. 36. Kretz questioned the appropriateness of Krull informing his DPW clients that he was retiring and that he could continue to represent them in a private capacity. a. Kretz was aware that Krull was retiring to pursue a profession that would allow him to represent clients in a private capacity. b. Kretz was made aware of Krull’s retirement plan while conversing with Krull shortly after he announced his retirement. Krull, 11-017 Page 10 c. Krull did not request Kretz to refer DPW clients to his private business. 37. Kretz reviewed Krull’s work area that same day after DPW employees (including Krull) had left for the day. a. Kretz discovered forty-one letters authored by Krull enclosed in DPW envelopes addressed to DPW clients on top of filing cabinets located at Krull’s work space. 1. The forty-one letters were identical to the letter found by Mikus and Kretz earlier that same day. b. Kretz additionally found two of Krull’s DPW business cards that had his DPW telephone number scratched out and replaced by the business telephone number for Krull and Associates, LLC (412-212-1175). 38. Kretz secured the envelopes in her office and did not deposit them into the mail. 39. On Monday, June 27, 2011, Dave Householder, Human Resources representative, DPW, contacted Harrisburg DPW’s legal office, informing it of the events of June 24, 2011. a. DPW’s legal office advised that Krull be informed not to report to work on his last day, Wednesday, June 29, 2011. 1. Krull had utilized annual leave on June 27, 2011. 40. Krull was contacted by Householder on June 27, 2011, and advised not to report to work on June 28, 2011, and/or June 29, 2011, due to the letters composed by Krull on June 24, 2011. a. Householder informed Krull that his actions and events of June 24, 2011, were being forwarded to the Pennsylvania State Ethics Commission for review. 41. Prior to the time of his conversation with Householder, Krull ordered five-hundred letterheads, five-hundred business cards, and five-hundred envelopes for Krull and Associates, LLC from Minuteman Press of Allison Park. 42. Krull ceased business activities as Krull and Associates, LLC, after his conversation with Householder. a. DPW clients who considered utilizing Krull and Associates, LLC, for DAP representation, made attempts to contact Krull in or about late June 2011 to further discuss their business arrangements. 1. Krull ended all contact with DPW clientele by ceasing any communication with them. b. DPW clients who were to utilize Krull and Associates, LLC, contacted DPW for assistance in contacting Krull. 1. DPW informed the clients that Krull was no longer employed by DPW. c. Communication between Krull and Associates, LLC and DPW clients ceased at or about the time Krull left Commonwealth employment on June 28, 2011. Krull, 11-017 Page 11 43. Krull’s 2011 IRS tax filings reflected no IRS 1099 MISC composite form from SSA documenting any payment received by Krull. a. Krull received no direct or indirect compensation from DPW clients for representation. b. Krull did not represent any DPW clients as a private disability representative at any SSA functions. c. Krull and Associates, LLC did not represent any DPW clients at any SSA functions. 44. Krull and Associates, LLC was not listed on Krull’s 2011 Federal tax filing Schedule C “Profit or Loss from Business.” a. Krull and Associates, LLC was never operational and ceased to exist by the end of June 2011. b. Krull and Associates, LLC was never operational and conducted no business. 45. On April 12, 2012, Krull provided a sworn statement to Commission investigators, at which time Krull stated the following: a. In 2009/2010 Krull began to contemplate the idea of providing private disability advocacy services after retirement. b. In approximately January/February 2009 Krull applied to be enrolled in SSA’s direct pay program. c. Krull’s membership with NOSSCR and his attendance at the NOSSCR convention in New Orleans in May 2010 provided him with knowledge to assist DPW clients as a DAP caseworker as well as future clients he would try to obtain as a private disability advocate. d. In late 2010 Krull was giving greater consideration to retiring from DPW to pursue being a private disability advocate. e. By March/April 2011 Krull began transferring DPW client information via flash drive/CD from his DPW office to his home officefor the dual purpose of providing services for clients while working at home, and also plans to do such work in the future on a private basis. f. Krull contacted at least nine DPW clients to determine if they would be interested in utilizing Krull as their private disability representative after Krull retired from DPW. 1. Krull made contact with said clients while still employed with DPW. g. Krull was aware that it was not permissible to represent DPW clients both publicly and privately at the same time. 1. Krull intended to transfer some of his DPW clients to the private sector with him after his retirement. Krull, 11-017 Page 12 h. Krull solicited DPW clients to utilize him as their private representative, and Krull asked DPW co-workers Stan Levandowski and Laron Thompson to refer DPW clients to Krull privately because they are initially responsible for the referrals of DPW clients. i. Krull tried to generate clientele for himself privately by generating the letter that was addressed to forty-one DPW clients in which Krull informed them of his retirement and his [availability] to provide private advocacy services. j. Krull stopped all contact with those DPW clients who indicated they would utilize Krull as their private representative after being contacted by David Householder, employee, Human Resources, DPW, on June 26, 2011. 1. Krull stopped the pursuit of creating his own private disability business. 2. Krull destroyed all of the DPW client information in his personal possession, however DPW maintains the originals of those files. k. Krull did not represent any DPW clients after his retirement from DPW. l. Krull did not receive any payments from DPW clients after his retirement from DPW. m. Krull never filed a Statement of Financial Interests form while employed as an Income Maintenance Caseworker by DPW. 1. DPW union representatives advised DPW Income Maintenance Caseworkers they are not required to file Statement of Financial Interests forms. THE FOLLOWING FINDINGS RELATE TO THE ALLEGATION THAT KRULL FAILED TO FILE STATEMENTS OF FINANCIAL INTERESTS FOR CALENDAR YEARS 2006, 2007, 2008, 2009, AND 2010. 46. Statement of Financial Interests (“SFI”) filing requirements for public officials and employees are mandated by Section 1104 of the State Ethics Act. a. Section 1104(a) mandates in part, the following: …Any other public employee or public official shall file a statement of financial interests with the governing authority of the political subdivision by which he is employed or within which he is appointed or elected no later than May 1 of each year that he holds such a position and of the year after he leaves such a position. 47. Income Maintenance Caseworkers are “public employees” as defined by the Pennsylvania Public Official and Employee Ethics Act (“Ethics Act”) (65 Pa.C.S. § 1101 et seq.) and are therefore subject to the provisions of the Ethics Act. a. The title of “Welfare Case Worker” was changed to “Income Maintenance Worker 2” and then to the current title of “Income Maintenance Caseworker” in 1985. Krull, 11-017 Page 13 b. Individuals holding the position of Income Maintenance Caseworker, or those who performed the same duties under a different title, were held to be “public employees” subject to the Ethics Act as early as 1997. 1. The Commission’s 1997 adjudication rendered in Metrick, Order No. 1037, concluded that caseworkers are public employees under the Ethics Act. c. DPW union representatives had advised that persons in Krull’s position were not required to file SFIs and that union was then currently involved in proceedings before the Commission over the filing issue. (Ludwig, Opinion 09-001, [decided] 3/12/09, [issued 3/27/09]). d. In Quaglia v. State Ethics Commission, the Commonwealth Court upheld the State Ethics Commission’s ruling that individuals employed by the Department of Public Welfare (“DPW”) as income maintenance caseworkers are subject to the Ethics Act, and the regulations thereunder, requiring “public employees” to, inter alia, file financial interests statements. Quaglia v. State Ethics Commission, 986 A.2d 974 (Pa. Cmwlth. 2010), amended by, 2010 Pa. Commw. LEXIS 8 (Pa. Cmwlth. January 5, 2010), allocatur denied, 607 Pa. 708, 4 A.3d 1056 (2010). 48. On or about September 2, 2011, SFIs required to be filed by Krull in his capacity as an Income Maintenance Caseworker were requested by the Investigative Division from DPW. a. DPW had not required Income Maintenance Caseworkers to complete and submit SFIs in their public positions. b. Krull had no SFIs on file with DPW. 49. Krull failed to file SFIs for calendar years 2006, 2007, 2008, 2009, and 2010. a. Krull failed to file SFIs upon advice by DPW union representatives that DPW Income Maintenance Caseworkers were not required to file SFIs. III.DISCUSSION: As an Income Maintenance Caseworker for the Pennsylvania Department of Public Welfare (“DPW”) from approximately January 11, 1982, to June 29, 2011, Respondent Mark Krull, hereinafter also referred to as “Respondent,” “Respondent Krull,” and “Krull,” was a public employeesubject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. See, Quaglia, supra. The allegations are that Respondent Krull violated Sections 1103(a) and 1104(a) of the Ethics Act: (1) when he, as an Income Maintenance Caseworker for DPW, used the authority of his public position and/or confidential information obtained through his public position for the private pecuniary benefit of himself and/or a private business with which he is associated to contact and contract, in a private capacity, with applicants/clients of DPW seeking Social Security Disability (“SSD”) and Social Security Income (“SSI”) benefits; (2) when he used the authority of his public position and/or confidential information obtained through his public position in an attempt to contract, in a private capacity, with applicants/clients of DPW seeking SSD and SSI benefits; (3) when he used the facilities and equipment and supplies of DPW in furtherance of his private business interest; and (4) when he failed to file Statements of Financial Interests (“SFIs”) for the 2006, 2007, 2008, 2009 and 2010 calendar years. Krull, 11-017 Page 14 Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a)Conflict of interest.— No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The term "conflict" or "conflict of interest" is defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 Pa.C.S. § 1102. Section 1103(a) of the Ethics Act prohibits a public official/public employee from using the authority of public office/employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official/public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Section 1104(a) of the Ethics Act provides that each public official/public employee must file an SFI for the preceding calendar year, each year that he holds the position and the year after he leaves it. As noted above, the parties have submitted a Consent Agreement and Stipulation of Findings. The parties' Stipulated Findings are set forth above as the Findings of this Commission. We shall now summarize the relevant facts as contained therein. From approximately January 11, 1982, to June 29, 2011, Respondent Krull was employed by DPW as an Income Maintenance Caseworker under job classification number 44720. Commencing February 7, 2005, Respondent worked in DPW’s Disability Advocate Program (“DAP”) division as a DAP Caseworker/Advocate, still under job classification number 44720. Respondent retired from DPW effective June 30, 2011. DAP is a social service program that was established by DPW in 1985 to assist DPW clients with disabilities through the Supplemental Security Income (“SSI”) and Social Security Disability Insurance (“SSDI”) application and appeal process. SSI and SSDI are federally funded programs that are administered and regulated by the Social Security Administration (“SSA”). Krull, 11-017 Page 15 Respondent’s duties as a DAP Caseworker/Advocate included, but were not limited to, acting as the appointed non-attorney representative for DPW clients who authorized Respondent to represent them in matters related to their claims with SSA. In his capacity as a DAP Caseworker/Advocate, Respondent was not permitted to receive any fees for such representation. DPW policies outlined in Chapter 820 of the DAP prohibited DAP Caseworkers/Advocates from collecting fees for representing DPW clients. When a DPW client selects the DAP Caseworker/Advocate as his/her non-attorney representative, DPW procedures require the DAP Caseworker/Advocate to complete the “waiver of fee” section of SSA’s Appointment of Representative Form (SSA 1696 form), waiving the right to charge and collect a fee for such representative services. Respondent has been an enrolled member of SSA’s Direct Payment to Non- Attorney Representatives Program (“NRP”) since January/February of 2009. Respondent has been a registered member in the National Organization of Social Security Claimants’ Representatives (“NOSSCR”) since on or about April 18, 2010. Respondent’s enrollment in SSA’s NRP and membership with NOSSCR occurred during a time when he was contemplating retiring from DPW to pursue a career as a private non-attorney Disability Advocate. DPW client information is confidential and to be used only for DPW business. Respondent, in his position as a DAP Caseworker/Advocate, had access to DPW client information. In a sworn statement to Commission investigators, Respondent acknowledged that by March/April 2011, he began transferring DPW client information via flash drive/CD from his DPW office to his home officefor the dual purpose of providing services for clients while working at home and plans to do such work in the future on a private basis. Respondent acknowledged that he intended to transfer some of his DPW clients to the private sector with him after his retirement. Respondent also acknowledged that while he was still employed with DPW, he contacted at least nine DPW clients to determine if they would be interested in utilizing Respondent as their private disability representative after Respondent retired from DPW. Respondent acknowledged that he asked DPW co- workers Stan Levandowski and Laron Thompson to refer DPW clients to Respondent privately because those individuals are initially responsible for the referrals of DPW clients. DPW clients contacted by Respondent indicated that Respondent spoke to them about his possible private representation of them after his retirement. These contacts occurred between January and June 2011. Respondent made his DPW clients aware of his intimate knowledge of their cases. Respondent discussed his fee with his DPW clients who verbally agreed to utilize Respondent as their private non-attorney representative. On or about June 17, 2011, Respondent sent an email to his supervisor, Francis Rectenwald, to inform Rectenwald about his intentions of retiring from DPW. Rectenwald responded to Respondent’s email, informing Respondent to submit a formal notice of retirement to Patricia Steinkopf (“Steinkopf”), DPW’s Southern District Director. By the time Respondent informed Rectenwald of his plan to retire, Respondent had already devised a business plan to establish a home-based sole proprietorship that provided non-attorney disability advocacy services. Respondent named his business “Krull and Associates, LLC.” Respondent did not register the business with the Pennsylvania Corporation Bureau or file any Articles of Incorporation. On or about June 22, 2011, Respondent issued a formal notice of retirement to Steinkopf notifying DPW of his plan to begin his retirement on June 30, 2011. Respondent also made his DPW colleagues aware of his plan to retire during the week of June 20, 2011. Respondent indicated to his colleagues that he was planning to begin his own disability advocate business in the near future to assist individuals through the Krull, 11-017 Page 16 SSI/SSDI application/appeals process. Respondent advised of his willingness for DPW clients to be referred to his business. On or about June 24, 2011, Respondent received confirmation that his retirement had been accepted by DPW. Respondent’s final date of employment was scheduled for June 29, 2011. On Friday, June 24, 2011, Rectenwald directed Respondent to generate a contact letter to a number of DPW clients identified by Rectenwald, who might be eligible for DAP assistance. DPW utilizes a form letter to notify clients of such services. As detailed at Fact Finding 30, Respondent altered the content of the letter to include information that Respondent would be available, in a private capacity, to assist clients with DAP. Respondent altered the aforesaid letter with the intent to generate clientele for Krull and Associates LLC. Respondent listed the business telephone number for Krull and Associates, LLC on such correspondence. Respondent only had access to the DPW clients eligible for DAP assistance as a result of his employment as a DPW Income Maintenance Caseworker. The client information was personal and confidential and not available to the public. Respondent prepared the contact letter throughout the course of his normal work hours. The letter altered by Respondent came to the attention of Respondent’s superiors at DPW on June 24, 2011. One such superior discovered: (1) forty-one of the altered letters authored by Respondent enclosed in DPW envelopes addressed to DPW clients on top of filing cabinets located at Respondent’s work space; and (2) two of Respondent’s DPW business cards that had his DPW telephone number scratched out and replaced by the business telephone number for Krull and Associates, LLC. In his sworn statement to Commission investigators, Respondent acknowledged that he tried to generate clientele for himself privately by generating the aforesaid letter. Respondent had utilized annual leave on June 27, 2011. On June 27, 2011, Respondent was contacted by a DPW Human Resources representative and advised not to report to work on June 28, 2011, and/or June 29, 2011, due to the letters composed by Respondent on June 24, 2011. The Human Resources representative informed Respondent that Respondent’s actions and events of June 24, 2011, were being forwarded to this Commission for review. After his conversation with the aforesaid DPW Human Resources representative, Respondent ended all contact with DPW clientele. Respondent received no direct or indirect compensation from DPW clients for representation. Krull and Associates, LLC was never operational and ceased to exist by the end of June 2011. We shall now review the Stipulated Findings regarding Respondent’s failure to file SFIs. Individuals holding the position of Income Maintenance Caseworker, or those who performed the same duties under a different title, were held to be “public employees” subject to the Ethics Act as early as 1997. In 2009 DPW union representatives were involved in proceedings before this Commission challenging the requirement that Income Maintenance Caseworkers file Statements of Financial Interests pursuant to the Ethics Act. See, Ludwig, supra. In Quaglia, supra, the Commonwealth Court of Pennsylvania upheld this Commission’s ruling that individuals employed by DPW as Income Maintenance Caseworkers are subject to the Ethics Act, and the regulations thereunder, including requirements to file Statements of Financial Interests. On or about September 2, 2011, the Investigative Division requested Respondent’s SFIs from DPW. DPW had not required Income Maintenance Caseworkers to complete and submit SFIs in their public positions. Respondent had no SFIs on file with DPW. In relation to the allegations before us, Respondent failed to file SFIs for calendar years Krull, 11-017 Page 17 2006, 2007, 2008, 2009, and 2010. Respondent failed to file SFIs upon advice by DPW union representatives that DPW Income Maintenance Caseworkers were not required to file SFIs. Having highlighted the Stipulated Findings and issues before us, we shall now apply the Ethics Act to determine the proper disposition of this case. The parties' Consent Agreement sets forth a proposed resolution of the allegations as follows: 3. The Investigative Division will recommend the following in relation to the above allegations: a. That no violation of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. §1103(a) occurred in relation to Krull’s attempts to contact and contract with applicants/clients of DPW seeking Social Security Disability (SSD) and Social Security Income (SSI) benefits; nor when he utilized the facilities, equipment and supplies of the Department of Public Welfare in furtherance of his private business interest, as there is insufficient evidence to establish a violation by way of clear and convincing evidence. b. That a violation of Section 1104(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. §1104(a) occurred when Krull failed to file Statements of Financial Interests for the 2006, 2007, 2008, 2009 and 2010 calendar years. 4. Krull agrees to make payment in the amount of $2,250.00 in settlement of this matter payable as follows: a. $1,250.00 payable by certified check or money order made payable to the Commonwealth of Pennsylvania and forwarded to the Pennsylvania State Ethics Commission within thirty (30) days of the issuance of the final adjudication in this matter. b. $1,000 in reimbursement representing a portion of the expenses and costs incurred by the State Ethics Commission in the investigation and administrative prosecution of the instant matter, payable by certified check or money order made payable to the Pennsylvania State Ethics Commission. Said payment is to be forwarded to the Pennsylvania State Ethics Commission within thirty (30) days Krull, 11-017 Page 18 of the issuance of the final adjudication in this matter. 5. Krull agrees to file Statements of Financial Interests with the Department of Public Welfare, through the Pennsylvania State Ethics Commission, for 2006, 2007, 2008, 2009 and 2010 calendar years within thirty (30) days of the issuance of the final adjudication in this matter. 6. Krull agrees to not accept any reimbursement, compensation or other payment from the Commonwealth of Pennsylvania representing a full or partial reimbursement of the amount paid in settlement of this matter. 7. The Investigative Division will recommend that the State Ethics Commission take no further action in this matter; and make no specific recommendations to any law enforcement or other authority to take action in this matter. Such, however, does not prohibit the Commission from initiating appropriate enforcement actions in the event of Respondent's failure to comply with this agreement or the Commission's order or cooperating with any other authority who may so choose to review this matter further. Consent Agreement, at 2-3. In considering the Consent Agreement, we accept the recommendation of the parties for a finding that no violation of Section 1103(a) of the Ethics Act occurred in relation to Respondent’s attempts to contact and contract with applicants/clients of DPW seeking SSD and SSI benefits; nor when he utilized the facilities, equipment and supplies of DPW in furtherance of his private business interest, based upon the parties’ agreement that there is insufficient evidence to establish a violation by way of clear and convincing evidence. It appears that the parties’ recommendation as to the finding of no violation of Section 1103(a) of the Ethics Act might be based upon the fact that Respondent’s aforesaid actions ultimately did not result in any private pecuniary benefit. We recognize the rights of the parties to negotiate the recommended result through a Consent Agreement. We accept the parties’ Consent Agreement and hold that no violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Respondent’s attempts to contact and contract with applicants/clients of DPW seeking SSD and SSI benefits; nor when he utilized the facilities, equipment and supplies of DPW in furtherance of his private business interest, based upon the parties’ agreement that there is insufficient evidence to establish a violation by way of clear and convincing evidence. As for the second recommendation of the Consent Agreement, we agree with the parties and we hold that a violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred when Respondent failed to file SFIs for the 2006, 2007, 2008, 2009 and 2010 calendar years. Quaglia, supra, confirmed that DPW Income Maintenance Caseworkers are subject to the Ethics Act, including the requirements for filing Statements of Financial Interests. Respondent failed to comply with those requirements. Krull, 11-017 Page 19 As part of the Consent Agreement, Respondent Krull has agreed to make payment in the amount of $2,250.00 in settlement of this matter payable as follows: (1) $1,250.00 payable by certified check or money order made payable to the Commonwealth of Pennsylvania and forwarded to this Commission within thirty (30) days of the issuance of the final adjudication in this matter; and (2) $1,000 in reimbursement representing a portion of the expenses and costs incurred by this Commission in the investigation and administrative prosecution of the instant matter, payable by certified check or money order made payable to the Pennsylvania State Ethics Commission and forwarded to this Commission within thirty (30) days of the issuance of the final adjudication in this matter. Respondent has agreed to not accept any reimbursement, compensation or other payment from the Commonwealth of Pennsylvania representing a full or partial reimbursement of the amount paid in settlement of this matter. Respondent has further agreed to file SFIs for calendar years 2006, 2007, 2008, 2009 and 2010 with DPW, through this Commission, within thirty (30) days of the issuance of the final adjudication in this matter. We determine that the Consent Agreement submitted by the parties sets forth a proper disposition for this case, based upon our review as reflected in the above analysis and the totality of the facts and circumstances. Accordingly, per the Consent Agreement of the parties, Respondent Krull is directed to make payment in the amount of $2,250.00 payable as follows: (1) $1,250.00 payable by certified check or money order made payable to the Commonwealth of Pennsylvania and th forwarded to this Commission by no later than the thirtieth (30) day after the mailing date of this adjudication and Order; and (2) $1,000 in reimbursement representing a portion of the expenses and costs incurred by this Commission in the investigation and administrative prosecution of the instant matter, payable by certified check or money order made payable to the Pennsylvania State Ethics Commission and forwarded to this th Commission by no later than the thirtieth (30) day after the mailing date of this adjudication and Order. Per the Consent Agreement of the parties, Respondent is directed to not accept any reimbursement, compensation or other payment from the Commonwealth of Pennsylvania representing a full or partial reimbursement of the amount paid in settlement of this matter. To the extent he has not already done so, Respondent is further directed to file SFIs for calendar years 2006, 2007, 2008, 2009 and 2010 with DPW, through this Commission, th by no later than the thirtieth (30) day after the mailing date of this adjudication and Order. Compliance with the foregoing will result in the closing of this case with no further action by this Commission. Noncompliance will result in the institution of an order enforcement action. IV.CONCLUSIONS OF LAW: 1. As an Income Maintenance Caseworker for the Pennsylvania Department of Public Welfare (“DPW”) from approximately January 11, 1982, to June 29, 2011, Respondent Mark Krull (“Krull”) was a public employeesubject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. 2. No violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Krull’s attempts to contact and contract with applicants/clients of DPW seeking Social Security Disability and Social Security Income benefits; nor when he utilized the facilities, equipment and supplies of DPW in furtherance of his private Krull, 11-017 Page 20 business interest, based upon the parties’ agreement that there is insufficient evidence to establish a violation by way of clear and convincing evidence. 3. A violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred when Krull failed to file Statements of Financial Interests for the 2006, 2007, 2008, 2009 and 2010 calendar years. In Re: Mark Krull, : File Docket: 11-017 Respondent : Date Decided: 9/24/12 : Date Mailed: 10/9/12 ORDER NO. 1609 1. As an Income Maintenance Caseworker for the Pennsylvania Department of Public Welfare (“DPW”), Mark Krull (“Krull”) did not violate Section 1103(a) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), in relation to Krull’s attempts to contact and contract with applicants/clients of DPW seeking Social Security Disability and Social Security Income benefits; nor when he utilized the facilities, equipment and supplies of DPW in furtherance of his private business interest, based upon the parties’ agreement that there is insufficient evidence to establish a violation by way of clear and convincing evidence. 2. A violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred when Krull failed to file Statements of Financial Interests for the 2006, 2007, 2008, 2009 and 2010 calendar years. 3. Per the Consent Agreement of the parties, Krull is directed to make payment in the amount of $2,250.00 payable as follows: (a) $1,250.00 payable by certified check or money order made payable to the Commonwealth of Pennsylvania and forwarded to the Pennsylvania State Ethics Commission by no later than the th thirtieth (30) day after the mailing date of this Order; and (b) $1,000 in reimbursement representing a portion of the expenses and costs incurred by the Pennsylvania State Ethics Commission in the investigation and administrative prosecution of the instant matter, payable by certified check or money order made payable to the Pennsylvania State Ethics Commission and forwarded to this th Commission by no later than the thirtieth (30) day after the mailing date of this Order. 4. Per the Consent Agreement of the parties, Krull is directed to not accept any reimbursement, compensation or other payment from the Commonwealth of Pennsylvania representing a full or partial reimbursement of the amount paid in settlement of this matter. 5. To the extent he has not already done so, Krull is further directed to file Statements of Financial Interests for calendar years 2006, 2007, 2008, 2009 and 2010 with DPW, through the Pennsylvania State Ethics Commission, by no later than the th thirtieth (30) day after the mailing date of this Order. 6. Compliance with Paragraphs 3, 4 and 5 of this Order will result in the closing of this case with no further action by this Commission. a. Non-compliance will result in the institution of an order enforcement action. BY THE COMMISSION, ___________________________ Name, Case # Page 22 John J. Bolger, Chair