HomeMy WebLinkAbout610-R CohenMr. Mark N. Cohen
1705 Sue Ellen Drive
Havertown, PA 19083
Re: 86.133 -C
Dear Mr. Cohen:
*TATS ETHICS cQMMI5SIQN
*op FINANCg 51UILQING
HARRISOURG, 6 g{•IN 17120
ORDER OF THE COMMI SION
Order No. 610-8
Date Decided: March 10 1988
Date Mailed: March" 16, I988
The Ethics Commission has received a complaint regarding you and a
possible violation of Act 170 of 1978. On January 15, 1988, a hearing on the
matter was conducted and relevant evidence and testimony was presented. The
Commission has now completed its investigation. The individual allegations,
conclusions, and findings on which those conclusions are based are as
follows:
I. Allegation: That you, Director of Enforcement, Pennsylvania Securities
Commission, violated Section 3(a) of the Ethics Act, which prohibits a public
employee's or public official's use of office or confidential information
gained through that office to obtain financial gain and Section 3(b) which
prohibits a public employee, public official or candidate from offering,
soliciting or accepting anything of value based on an understanding that the
vote, official action or judgment of the public official, public employee or
candidate will be influenced and Section 3(d) which prohibits other areas of
conflict of interests, by using your position to take and be paid for sick
leave while working on those same days as an arbitrator in the Philadelphia
Court of Common Pleas and the United States District Court in Philadelphia.
A. Findings:
1. You are a licensed Pennsylvania attorney who served as Director, Division
of Enforcement, Philadelphia Office, Pennsylvania Securities Commission from a
point in time prior to 1985 to your effective resignation date of August 1,
1986.
2. a. You authored a memo of July 1, 1982 to the Chief Counsel of the
Securities Commission and others wherein you stated that the Chief
Counsel decided that serving as court arbitrators was not permitted
and further that you believed that Commonwealth attorneys were
permitted to serve and that such service would provide beneficial
experience to staff attorneys.
Mr, Mark N. Cohen
[age 2
b. Y:u urged reconsideration for remission to serve as ar bi ::rator
[ . ov i ded thti „ conditions were met:
F•_ t,ll tim, served as an arbitrator be charged to annual or
personal leave.
Commission business shall not be rescheduled, postponer or
compromised in any way through service as an arbitrator.
3. That should a conflict ever arise between a scheduled arbitration
date and Commission business, the attorney shall call to can
his date of scheduled service in every such instance.
You advised the Chief Counsel of the Securities Commission by memo o July
7, 1;82 on the subject of staff attorneys' service as arbitrators that the
arbitration program had been reorganized so as to provide the arbitrators with
absolute certainty as to the dates of service.
4. By ;Aemo of July 26, 1982 you advised Enforcement Division attorneys that
ycur recommendation, that staff attorneys would be permitted to serve as
a rbi t r::tors, was approved but such approval was subject to five conditions:
1. All time served as an arbitrator be charged to annual or personal
leave.
2. Commission business shall not be rescheduled, postponed or
compromised in any way through service as an arbitrator.
That should a conflict ever arise between a scheduled arbitration
date and Commission business, the attorney shall call to cancel
his date of scheduled service in every such instance.
4. The Director of Enforcement is to be notified, in writing, of any
arbitration service as soon as the date for service is
scheduled.
5. After the date scheduled for service has passed, it shall be
assumed that the service was rendered as scheduled and the
Director of Enforcement shall forward that information to the
Di rector of Administrative Services.
5. The minutes of the Securities Commission from July 26, 1982 reflect, in
part, as to staff attorneys' service as arbitrators, that said attorneys
should report their activity to that Commission and that a timely reporting
format should be established.
Mr. Mark N. Cohen
Page 3
6. You advised all Enforcement Division nn by rnmo of June 4, 1984
that a Staff Attendance Log would oe maintained effective June 11, 1984 for
the Philadelphia and Pittsburgh District Offices according to ten guidelines:
1. There will be a separate sheet for each business day, dated at
the top.
2. Down the left hand side of each sheet will be the name of every
person that is assigned to work-in the district office.
3. The word "In" is to be placed next to the name of each employee
when he or she arrives at the office. It is the responsibility
of each person to record himself or herself as "In" each day or
verify that the person in charge of the Log has appropriately
noted his or her arrival.
4. If any employee plans to be out of the office during business
hours for longer than 90 minutes, the employee shall indicate on
the Log where he or she is going, the purpose of the visit and
estimated time of return.
5. If it appears that the estimated time of return will be off by 30
minutes or more, or if another stop is being made before
returning, the employee shall call in to request that the return
time on the Log be revised and /or the new destination added.
6. When an employee is going out to lunch, that too shall be noted
with the time of return.
7. Any employee not reporting to work shall call the Log secretary
by 9:30 A.M. to report that fact along with the type of leave to
be recorded.
8. Leave slips shall be prepared to correspond with the Log
entries.
9. Any dispute, concerning the leave code or time charged, that
cannot be resolved shall be brought to my attention.
10. Staff planning to be out of the office for 3 or more consecutive
business days shall inform the Log secretary of those days and
this information shall be relayed to me.
a. You served on arbitration panels in 1985 and 1986 both in the Court
of Common Pleas of Philadelphia County (CCP, PC) and the United
States District Court, Eastern District. (USDC, ED).
Mr.- M l; N.- Cohen
rage ':
b, The following table contain_ a partial list of cases on vtich you
were ar; arbitrator for 1985/86 wherein the date of service, t;:J court
and the amount of your pays nt is reflected:
Date of Service Court Amount Paid
01/08/85 CCP,PC $200.00
05/09/85 CCP,PC $200.00
06/20/85 CCP,PC $200.00
07/23/85 CCP,PC $100.00
08/01/85 USDC,ED $ 75.00
08/06/85 CCP,PC $200.00
08/27/85 USDC,ED $150.00
09/11/85 USDC,ED $ 75.00
09/19/85 CCP,PC $200.00
10/31/85 USDC,ED $ 75.00
11/21/85 CCP,PC $200.00
12/2/85 USDC,ED $ 75.00
04/17/86 CCP,PC $200.00
You admit, by way of stipulation, the following:
a. That the Attendance Log maintained by the Pennsylvania Securities
Commission contains the following data compiled during the regular
course of business:
(1, You are l i steel as "sick" f,;: ,:uy on these date:
May 9, 1985; June 20, 1985; August 1, 1985; August 6, 1985;
September 19, 1985 and November 21, 1985.
(2) The designation "sick family" for the entire day is listed for
your absence on the following days: July 23, 1985 - rd August
27, 1985.
I. Regarding your payments for arbitration service on January 8, 1985;
September 11, 1985; October 31, 1985; December 2, 1985 and April 17, 1986;
a. (1) Although the Securities Commission Logs contains the notation:
"A (no slip) (nothing on absence rpt.) ", the Securities
Commission 1985 Record of Absence reflects that you did not take
annual leave for January 8, 1985.
(2) For September 11, 1985, the Log reflects the following "4.5
hrs. P [ -] Lunch [ -] Library" which correlates to the Absence
Record.
Mr. Mark N. Cohen
Page 5
(3) The Securities Commission Log for October 31, 1985 contains the
following: "4.5 -A (1) T L & W & H" which conforms to the
Record of Absence for 1985.
For December 2, 1985 the Log reflects "Law Library" plus two
undiscernable letters and the Absence Record shows no leave
taken.
The Securities Commission Log for April 17, 1986 contains the
notation: "AM- Library PM -4 hrs. P" and the Absence Record
reflect 4 hours personal leave being taken.
b. You testified as to the above five days that you did sign out for
Janaury 8, 1985 for which you were paid $200 for arbitration work but
it was not recorded because some secretary in Harrisburg made a
mistake; as to the other four days, you state that only a portion of
annual /personal was taken because the arbitration services was a
"short" day and that a law library designation was used because the
arbitration service was rendered or the case had been settled and you
brought work with you to do at the law library because the Securities
Commission had no library facilities.
10. You personally signed and submitted Commonwealth STD -330 Request for
Leave Slips for full days as to the following days for which you served as an
arbitrator:
a. May 9, 1985 - Sick leave, signed on June 6, 1985, approved by Elliott
Klein on June 5, 1988.
b. June 20, 1985 - Sick leave, signed July 8, 1985, approved by Elliott
Klein on July 8, 1985.
c. July 23, 1985 - Sick family, signed August 2, 1985, approved by Klein
on August 5, 1985.
d. August 1, 1985 - Sick leave, signed August 16, 1985, approved by
Klein on August 14, 1985.
e. August 6, 1985 - Sick leave, signed August 16, 1985, approved by
Klein on August 14, 1985.
f. August 27, 1985 - Sick family, signed September 9, 1985, approved by
Klein on September 9, 1985.
g. September 19, 1985 - Sick leave, signed October 8, 1985, approved uy
Kleen on October 20, 1985.
f';r. Mark N. Cohen
Page 6
h. November 21, 185 —Sick leave, signed December 1.:, :.9" apprrved by
Klein on Dece9.:Jer 3, 1985.
11. There are no leave slips (STD -330) for leave, partial or full, as the
five days listed in Finding 9.
2. Commonwealth Management Directive 505.7 contains various provisions
"egarding sick leave for Commonwealth employees.
a. Section 30.21 of the Directive provides:
(a) Sick leave is time away from the job with compensation
Nhen an employe becomes too ill to work or must be absent
or valid sick related reasons as identified in §30.23.
(b) The rate of compensation for a sick leave day shall be
an employe's regular compensation in effect for the
employe's regular job subject to conditions established by
the Secretary of Administration through the Directives
Management System. (Reference Management Directive
=5.4).
b. Section 30.23 of the Directive, entitled "Reasons for Sick
Leave" provides:
Sick leave shall be granted when an employf is
required to be absent from work for one of the following
yeasons:
(1) Illness of the employe.
(2) Death, as follows:
(1) Death of a spouse, parent, stepparent, child, or
stepchild of the employe for which a maximum of 5 days
may be granted per occurence.
(ii) Death of a brother, sister, uncle, aunt,
grandparent, grandchild, son -in -law, daughter -in -law,
brother -in -law, sister -in -law, parent -in -law, or
grandparent-in-law - for which a maximum of 3 days may
be granted per occurrence.
(iii) Death of any other relative residing in the
employe's household - for which a maximum of 3 days_
may be granted per occurrence.
Mr. Mark N. Cohen
Page 7
(3)
Contact with or exposure to contagious disease
rendering the presence of the employe hazardous to
fellow employes.
(4) Necessary medical or dental appointments for the
employe or the employe's immediate family, as defined
in paragraph (5), below, that cannot be scheduled
during nonwork hours and that meet one or both of the
following criteria:
(i) The immediate family member is physically unable
to drive a vehicle or is otherwise unable to reach the
medical facility without the employe's absence.
(ii) The illness of the immediate family member
requires the empl oye's personal attendance.
(5) Serious illness of a member of the employe's immediate
family which requires the employe's absence from work
not to exceed 5 days in any calendar year. Immediate
family is defined as the following persons residing in
the employe's household: husband, wife, child, or
parent of the employe.
13. Employees of the Commonwealth of Pennsylvania are required to submit
Request for Leave Slips, STD -330 forms, for annual , personal or sick day
usage.
14. (a) Financial Interest Statements dated April 22, 1986 for the calendar
year 1985 lists "local court adminstrator - as arbitrator" as a
direct source of income.
(b) The Statement fails to list the United States District Court,
Eastern District as a source of income in excess of $500.
(i) You received payment of $1,275.00 from the above
court in 1985. Exhibit, SEC -9.
15. The following stipulations were entered into at the hearing held on
Friday, January 15, 1988:
a. As of the date of your resignation,
unused earned sick leave.
h. All disputed sick leave was repaid
period of your employment with the
you accumulated 400 hours of
to the Commonwealth as to the
Securities Commission.
Mr. Mark N Cohen.
-Page 8
c. As part of your employment with the 5!:.uri‘ies Commission, you we:e
cal l cd upon to travel away from horrs,. on offi ci a ; business for 36
3 and Sundays for which nq leave time or compensat'on was
earned.
d. The Chairman and Chief Counsel of the Securities Commission accep °ec
your apology and offer of repayment and wanted you to remain in your.
position with the Securities Commission.
e. The Securities Commission and Chief Counsel believed that at the time
of your resignation that the matter had been resolved to the
satisaction of all concerned parties and that the matter would hp
closed by the State Ethics Commission.
16. (a) As to your service with the Securities Commission, your Perfcrrm ce
Evaluation Request for the 1984/85 service year reflects % uniform
rating of excellent.
(b) The minutes of the Securities Commission of July 14, 1985 reflect:
acknowledgement of your resignation, effective August 1, 1986;
regrets as to the acceptance of your resignation and a statement by
Securities Commission Chairman as to your accomplishments and
deserved credit.
You presented the following arguments to this Commission:
a. That there can be no violation of Section 3(a) of the Ethics Act
when a public employee does not comply with sick leave policy of his
employing agency.
That Section 3(a) only prohibits: use of office or confidential
information to obtain a financial gain; abuse of power by a public
,employee or, lastly, influence peddling or profiteering through use
of office or information gained by holding that office,
c„ ehat there was no use of office or confidential information to secure
arbitration assignments.
d. (either Section 3(a) nor the legislative intendment confers authority
upon the state Ethics Commission to review sick leave Natters.
e. The enforcement o" sick leave policy should be left to the
resolution of the employing agency Ohich resolved your case two years
ago.
r
The Dorrance, Order 456 is distinguishable because that involved a
Commonwealth attorney who also had a private practice for which he
r° "i1i>>d the state office, secretary, supplies, #Aluipment and postage
mote,
Mr. Mark N. Cohen
Page 9
Everybody takes advantage of sick leave allocation to run errands,
work around the house, go to the store, extend weekends or sit on
arbitration panels.
h. What happened was a mistake and wrong.
i. That this Commission should exercise its discretion and close this
matter since there is no probable cause that a violation of the
Ethics Act occurred.
g.
j•
This Commission should not assume the responsibility of the employing
agency, the Office of Administration or the Legislature as to sick
1 eave cases.
k. All questionable leave was returned, this matter was resolved to the
complete satisfaction of the Securities Commission and the file
should be closed by this Commission without any formal opinion.
B. Discussion: As Director of the Division of Enforcement for the
Pennsylvania Securities Commission, you were a public employee as that term is
defined under the Ethics Act. 65 P.S. §402; 51 Pa. Code §1.1. Accordingly,
your conduct is subject to the provisions of the Ethics Act.
Section 3(a) of the Ethics Act provides:
Section 3. Restricted activities.
(a) No public official or public employee shall use his
public office or any confidential information received
through his holding public office to obtain financial gain
other than compensation provided by law for himself, a
member of his immediate family, or a business with which
he is associated. 65 P.S. §403(a).
Section 3(a) basically provides that a public employee may not use public
office or confidential information to obtain financial gain other than
compensation provided for by law.
Section 3(a) provides that a public employee may not use his public
office or confidential information to obtain a financial gain other than
compensation as provided for by law for himself or a member of his immediate
family. Under this provision, this Commission has determined that the use of
office by a public employee to obtain a gain or benefit for himself or a
member of his immediate family which is not provided for in law constitutes a
"financial gain other than compensation provided for by law." These
determinations have been appealed to the Commonwealth Court of Pennsylvania
Mr. Mf:rk N. Coht:,
Page 10
which has affirmed the Orders of the Commission. SE_ McCutchecn v. Stag
Ethics Commission, 77 Pa. Commw. 529, 466 A.2d 283 (1983). See also Yocabet
v. State Ethics Ethics Commission, Pa. Commw. , 531 A.2d 536 (1987).
Thus, under this provision, a public employee may not use his public position
to secure any financial gain for himself or a member of his immediate family
un?ess it is provided for by law. Domalakes, Opinion 85 -010; Huff, Opinion
84 -015.
JCI.��vt ,J1J) or clie P1t:c provides:
Section 3. Restricted activities.
(b) No person shall offer or give to a public official or
public employee or candidate for public office or a member
of his immediate family or a business with which he is
associated, and no public official or public employee or
candidate for public office shall solicit or accept,
anything of value, including a gift, loan, political
contribution, reward, or promise of future employment
based on any understanding that the vote, official action,
or judgment of the public official or public employee or
candidate for public office would be influenced thereby.
65 P.S. §403(b).
Section 3(b) Basically provides that a public employee may not accept or
.eceive anything of value based upon the understanding that his official
actions would be affected thereby.
It is provided in Section 3(d) of the Ethics Act:
Section 3. Restricted activities.
(d) Other areas of possible conflict shall be addressed by
the commission pursuant to paragraph (9) of section 7.
65 P.S. 403(d).
In this case, you have admitted that you took off eight days, for which
you claimed as "sick" or "sick family" and used that paid Commonwealth sick
leave to sit and receive payment on arbitration panels. You dispute, however,
five additional days for which you served and were paid for arbitration
service by asserting either that it was a secretarial mistake or that you took
leave for part of the day when you served as arbitrator or lastly that you
served as arbitrator and the case was settled so that you really were in the
library. Regarding the factual dispute as to these other five days, this
Commission finds as a matter of fact that as to September 11, 1985, wherein
;:he Absence Record and Log relects 4.5 hours of personal leave, as to October
3 , 1985, wherein the Log and Absence Record indicate 4.5 hours of annual
Mr. Mark N. Cohen
Page 11
leave and as to April 17, 1986, wherein the Log and Absence Record reflect 4
hours of personal leave, there is unsufficient evidence to establish that you
sat on the arbitration panel during the remainder of these three days for
which you did not claim leave. However, as to the Janaury 8, 1985 date, this
Commission does not accept your testimony as being credible that you were not
charged with 7.5 hours of annual leave because of a secretarial mistake in
Harrisburg. It is your responsibility to question and resolve any mistakes or
discrepancies in your leave record. As to the fifth day in contention,
December 2, 1985, the Log reflects you were in the law library and the Absence
Record reflects no leave taken. Based upon documents, this Commission finds,
as a matter of fact, that you served on December 2, 1985 for arbitration
service while simultaneously receiving payment for 7.5 hours with the
Securities Commission. Overall, you served for a total of ten days in 1985
and received payment for arbitration work when you also received payment for
eight days of sick leave and two days for false time on the job at the
Securities Commission.
Under these circumstances, all of the elements necessary to establish a
violation of Section 3(a) of the Ethics Act have been established. During the
year in question, 1985, you were a public employee as Director of the
Enforcement Division in the Securities Commission. You did use your public
office by claiming and being paid for bogus sick, sick family, library or in
house time when you were, in fact, serving on those dates on arbitration
panels for which you also received payment. Lastly, you obtained financial
gain other than compensation provided for by law in two respects: first, as
to the state pay you received for the bogus sick, sick family, library or in
house time and secondly as to the payment you received on those days from
sitting on the arbitration panels.
In addition, it must be noted that you were the individual who initiated
and was instrumental in obtaining approval for Securities Commission staff
attorneys to participate in the arbitration program. One of the several
conditions imposed upon participation by the staff attorneys in the
arbitration program was that the leave had to be annual or personal; you
clearly disregarded that condition by using false sick leave or claiming no
leave at all. You have been incriminated by the staff log attendance system,
your leave slips and your Absence Record.
Your opprobrious use of public office for personal financial gain
violates both the letter and spirit of the Ethics Act set forth in Section
3(a).
There is no evidence to establish that you solicited or accepted anything
of value based on the understanding that your official action would be
influenced thereby. Accordingly, this Commission finds no violation of
Section 3(b) or 3(d) of the Ethics Act.
Mr.. Mark F!,
kage 12
You, however, assert that Sectirn 3!a) only applies to cases involving
:rsc: of office for gain, such as abuses of power by public employees, influence
eddl i ng or profiteering, but would not extend to securing arbitration
c,ssignments. As to the claim that Section 3(a) does not prohibit arbitration
!ereice, you have misfocussed the allegation in this case. The basis of the
complaint relates to the use or misuse of office by using bogus sick, library
or in house time for arbitration service; the arbitration service in and of
itself does not constitute the violation.
It is then asserted that Section 3(a) of the Ethics Act does not cover
cases of compliance with sick leave policy which should be within the
exclusive province of the employing agency. As previously noted, Section 3(a)
covers cases of use of public office to obtain financial gain; misuse of paid
sick leave to obtain a financial gain from other employment on days where an
individual receives compensation for bogus sick leave is covered by Section
3(a). See Neuber er, Order 596, where this Commission found a public official
violated Section 3 a) for receiving "administative" pay to which he was not
entitled. See also McCutcheon and Yocabet, supra. Your attempt to
:distinguish Dorrance, Order 456 is unavailing since in that case this
Commission found that a public employee /attorney violated Section 3(a) of the
Ethics Act when he used public office by utilizing state office personnel,
materials, equipment and postage for private legal work. Use of public office
for personal financial gain transgresses Section 3(a) of the Ethics Act.
Huff, supra.
You claim that you should not be singled out because "everybody" tales
advantage of sick leave. First, your assertion that "everybody" abuses le=ave
is false. Secondly, implicit in your statement is a defense that you should
'.ot be found in violation because "everybody [else]" abuses leave brt
didn't /doesn't get caught. The foregoing reduces to a defense that on should
not be found in violation if others do the same act and are not found out.
Such an argument for exculpation is not worthy of response.
It is noted that all questionable leave was returned to the satisfaction
of the Securities Commission. However, this was done only after charges
surfaced regarding your misuse of sick leave. The foregoing is not a basis
for exoneration. Further, it should be stated that following termination of
Commonwealth service, a former employee (except those meeting the requirements
of age 60 with ten (10) years of service or twenty -five (25) years of service)
does not get paid for unused sick leave but does get paid for unused annual
leave. This seems to be the motivational basis for your misuse of leave.
Under these circumstances, you used your public office for financial gain
and violated the public trust; you violated Section 3(a) of the Ethics Act.
You have not violated Section 3(b) or 3(d) of the Ethics Act based upon an
insufficiency of evidence.
Mr. Mark N. Cohen
Page 13
C.
Conclusion and Order:
1. As a Director of Enforcement Director for the Pennsylvania Securities
Commission, you were a public employee subject to the provisions of
the Ethics Act.
2. You violated Section 3(a) of the Ethics Act when you received
financial gain other than compensation as provided for by law in the
form of arbitration fees for your participation in that program which
was not in compliance with the policy of the Securities Commission.
3. You violated Section 3(a) of the Ethics Act in that you received
compensation other than provided for by law when you were paid for
bogus sick leave or for false "logged in" time at your office or
library when you, in fact, were sitting on arbitration panels and
receiving fees therefrom.
4. There is insufficient evidence to establish that you violated
Sections 3(b) or 3(d) of the Ethics Act.
5. This matter will be referred to the appropriate legal authority with
this Commission's strong recommendation that a prosecution be
instituted. This matter will also be referred to the Disciplinary
Board of the Pennsylvania Supreme Court for review.
Our files in this case will
Section 8(a) of the Ethics Act,
and will be made available as a
as mailing).
remain confidential in accordance with
65 P.S. 408(a). However, this Order is final
public document 5 days after service (defined
By the Commission,
+r) t tstn. JQi
G. Sieber Pancoast
Chairman