Feb. 8, 2016 SIGN IN | REGISTER

Aren’t False Financial Disclosure Forms Illegal?

This does not mean that errors can never lead to serious consequences. When filing a statement, a filer must certify that the statements it contains are “true, complete and correct to the best of my knowledge and belief.” Above this certification, there is a reminder that false statements can result in serious penalties and sanctions. Notably, Title 18, U.S. Code, Section 1001 makes it a crime to knowingly and willfully make a materially false, fictitious or fraudulent statement in any Congressional matter.

So, how can you tell the difference between ordinary errors and the kind that can lead to serious trouble? Although there is no clear answer, the Ethics Committee report on the Buchanan matter does provide some clues.

Examples of “substantial or egregious errors,” the report says, “may include the failure to report significant amounts or whole categories of earned income, particularly when such income is also withheld from reporting on taxes.” They also may include “failing to disclose significant positions or transaction representing direct and obvious conflicts of interest, or a series of numerous errors and omissions over many years which reflect a substantial portion of reportable items.”

Buchanan’s errors concerned positions with six companies that he said he inadvertently failed to include in his statements. The errors also concerned unreported income, which, Buchanan said, totaled less than $15,000 over four years, which was less than 0.0001 percent of the assets disclosed in his statements.

The committee noted that there was no evidence that Buchanan’s errors were knowing or willful and that, when Buchanan was alerted to the errors, he promptly filed amendments to correct them. By filing statements containing inadvertent errors that he later corrected, the committee said, Buchanan was in a “posture not uncommon among filers.”

The safest course remains for your Member to aim for complete accuracy. Even in Buchanan’s case, where the committee concluded that his errors and amendments did not warrant sanctions, those errors still exposed Buchanan to the time and expense of responding to investigations by both the OCE and the Ethics Committee. The more careful filers are about the accuracy of their statements, the lower their risk of similar investigations.

C. Simon Davidson is a partner with the law firm McGuireWoods. Click here to submit questions. Readers should not treat his column as legal advice. Questions do not create an attorney-client relationship.

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