September/October 2017

It Doesn’t Pay to Play

Recent pay-to-play and bribery cases involving engineering firms serve as cautionary tales of the consequences of failing to abide by the principles of the NSPE Code of Ethics.

BY DANIELLE BOYKIN

With increasing competition to secure coveted contracts for engineering and design services, AEC firm executives and practice leaders must ensure that they stand out among the crowd. But sometimes efforts to gain favor and secure contracts—particularly for government and public projects—can go too far.

It should be obvious that offering donations or bribes to elected and public officials or committing outright fraud for financial gain crosses the line into unethical conduct. These actions can also lead to legal fallout that will likely ruin a professional engineer’s reputation and career. Yet, current news headlines and stories serve as a reminder of what happens when desire for financial gain is put over a duty to serve ethically and in the best interest of the public welfare.

In West Virginia, the state engineering licensing board has filed complaints against professional engineers who have pleaded guilty to federal charges in a pay-to-play scheme involving state Division of Highways contracts and funds, according to the Charleston Gazette-Mail. Since last year, several engineering firm executives have pleaded guilty to breaking New Jersey pay-to-play laws with illegal political donations and were sentenced to jail time and have been barred from seeking public contracts. And in Pennsylvania, a former Reading mayor and an Allentown mayor are facing federal charges for allegations of taking contributions from engineering firm executives in exchange for favor in the project bidding process.

The fundamental canons of NSPE’s Code of Ethics for Engineers call on licensed engineers to avoid deceptive acts and conduct themselves honorably, responsibly, ethically, and lawfully to enhance the honor, reputation, and usefulness of the profession. Pay-to-play schemes, fraudulent acts, and corruption are in direct violation of these canons and other rules of practice outlined in the Code of Ethics.

Section II.5.b. of the Code states: Engineers shall not offer, give, solicit, or receive, either directly or indirectly, any contribution to influence the award of a contract by public authority, or which may be reasonably construed by the public as having the effect or intent of influencing the awarding of a contract. They shall not offer any gift or other valuable consideration in order to secure work. They shall not pay a commission, percentage, or brokerage fee in order to secure work, except to a bona fide employee or bona fide established commercial or marketing agencies retained by them.

Not every engineer has a clear understanding or the best perspective on what actions can result in crossing an ethical line. Board of Ethical Review Chair Frank Stanton, P.E., F.NSPE, recalls leading an ethics session and using a Scranton bribery case as an example in a discussion. In 2012, a professional engineer was sentenced to a year in prison and fined for using bribes to gain government contracts. The federal case, which resulted in prosecution of government officials and other contractors, led to the loss of the engineer’s PE license.

Stanton was taken aback when a session participant commented, “Well, it’s a business decision, whether you make a bribe or not. It’s not a crime to offer a bribe. It’s a crime to take one.”

When faced with ethical challenges, Stanton remembers sage advice from a former employer. “The president of our company told me that if anyone asks you to do anything or wants a gift in exchange to get work, just pick up your papers and walk away. You don’t have to say anything else,” he recalls.

That advice and his knowledge of the Code of Ethics would come in handy when a public official once advised Stanton and a group of engineers on how to have greater influence with elected officials. He said that professional and technical societies would need to “grease the wheels” if they were interested in getting their public policy agendas met. “This official was [luckily] elected out of office six months after he made this suggestion,” he says.

Stanton believes that it’s important for professional engineers to share their stories about facing ethical challenges. “Real-life cases of ethical misconduct and the legal consequences faced are just as critical as potential situations to help educate on these issues,” he says.

Since 1954, selected NSPE members have served on the Board of Ethical Review to render impartial opinions pertaining to the interpretation of the Code of Ethics, and conduct studies relating to engineering ethics. Each year the board meets to discuss at least 12 ethics cases to provide guidance to professional engineers and ethics educators. “Members of the BER represent different states, disciplines, and career backgrounds. We bring our life experiences to the board when we have these discussions and render our conclusions,” says Stanton.

The BER Chair has had his fair share of turning down contracts and leaving employers because he saw patterns of unethical practice. He recently turned down a nine-month contract because the work would have exposed him to unlicensed practice in 17 states. “Unfortunately, there are engineers doing what I refused to do for that company.”

As vice president of ENC Group LLC, Stanton makes it clear that his business operating procedures follow the NSPE Code of Ethics. It’s also in the firm’s employee manual. “I worked pretty hard for my licenses, and I joined NSPE in part to know where the ethical and legal boundaries are when I’m practicing engineering,” he says.

The Enforcement Role

In Tulsa, Oklahoma, in 2009, professional engineers pleaded guilty to federal charges of bribing city officials in exchange for engineering contracts. They were sentenced to federal prison and had to pay restitution. Because of the violation and the publicity that it raised, the Oklahoma State Board of Licensure for Professional Engineers and Land Surveyors revoked their licenses, says Bruce Pitts, P.L.S., the board’s assistant director and director of enforcement.

Some licensing boards, like the Oklahoma board, can revoke a license if a licensee is convicted of a felony or pleads guilty to a felony that substantially relates to licensed practice or poses a reasonable threat to public safety. In some cases, a guilty plea to a misdemeanor that is linked to an element of dishonesty or is a violation of the practice of engineering or land surveying can also warrant a license revocation or suspension.

Good character and reputation are also up for consideration when boards are reviewing licensure applicants. “This is a part of some of the hard work that board members have to do—determining if someone can gain a license in the state or maintain a license,” says Pitts, who chairs the National Council of Examiners for Engineering and Surveying’s Committee on Law Enforcement.

State licensing boards have different abilities to pursue legal actions against licensees and unlicensed individuals. Some boards are considered “autonomous,” says Pitts, which means that they don’t have to work directly with the attorney general’s office or district attorneys to act against unlicensed practice or licensure violations. The boards can levy administrative fines and reprimand, revoke, and suspend licenses or place licensees on probation.

Licensing boards that cannot prosecute violations must work through their district attorneys and state attorney general offices. These boards may have difficulty getting an elected official to prosecute an individual who is engaging in unlicensed practice, says Pitts; however, it might not be so difficult if there are allegations of fraud or criminal activity.

How do licensing boards stay informed of violations of their licensees in other jurisdictions? NCEES maintains an Enforcement Exchange, a central database for boards to submit information about disciplinary actions. “If an engineer is found guilty of violating an engineering law in Oklahoma, we report that to the Enforcement Exchange and the other boards are instantly aware of this violation,” says Pitts.

One of the Committee on Law Enforcement’s charges is to determine how boards should respond once they are aware of information about a licensee. “If a licensee is living in South Carolina, but has been disciplined in Oklahoma, what should that board do,” he says. “Should they send a letter to the licensee, slap them on the wrist, or open a case to review the licensee?” NCEES wants boards to have information on disciplinary violations, but the challenge is to avoid “piling on” licensees, say Pitts.

The committee also provides licensing boards with best practices for enforcement and will assist boards that want to set up or improve their enforcement programs. “Members of the committee learn from each other and discuss what works and what’s not working to help shape the type of enforcement we’d like to see,” says Pitts.

Leading by Example

Jim Meads, P.E., recalls that his first job out of engineering school provided his first important lesson on ethical decision making. He worked for a company that paid its surveyors to spend the weekends working on the county engineer’s farm. At the time, the company was doing a lot of business with the county government.

Meads admits that he didn’t know much about engineering at that time, but he knew what the firm leaders were doing wasn’t right. “I observed the way things were going and I made a choice to leave,” he says. “I took a cut in pay to do it, but it was the best career move that I’ve ever made.”

For more than a decade, Meads has served as the chief ethics officer for Sain Associates, an engineering and construction services firm headquartered in Birmingham, Alabama. The previous CEO realized that to maintain a culture of ethical practice and to deal with the ethical issues that cropped up from time to time, there needed to be a “go-to person,” he says.

As the current president and CEO, Meads makes the 45-year-old firm’s expectations crystal clear. “Our practices are written down in the ‘Sain Associates Core Values Related to Personal Character,’” he says. “We use that in our hiring process and in some of our decision-making processes.”

Meads’ firm also chooses subconsultants based on their reputations and ethical values. “If we are the prime consultant, they are a representation of our firm as well,” he says. “We want to make sure that we are a match from an ethical standpoint and the way we go about doing business.”

If Sain Associates is a subconsultant on a project, he adds, the firm wants to make sure that its values match those of the prime consultants. “There are also some potential clients that we choose not to work with based on our ethical values,” Meads says.

One area that could give rise to ethical challenges, says Meads, is an increase in bidding for engineering services, as evidenced in pay-to-play cases. “We continue to see an increase in firms willing to be selected based upon price,” he says. “We see that in the public and private sector, although it’s more of a problem in the private sector.”

Through Meads’ leadership, Sain Associates is a strong proponent of qualifications-based selection. The company puts a statement in project proposals about the fallacies around bidding. “NSPE’s Code of Ethics and other engineering societies incorporate some provision that the engineer should be selected based on qualifications and not price. We really try to practice that way,” he says. “If you look at the codes and the laws, the first thing that it talks about is the health, safety, welfare of the public. That’s important.”

A Responsibility

As a professional engineer licensed in 23 states, Meads understands that it can be quite challenging to keep up with various state and local ethics laws, particularly the ones that govern how individuals and companies can deal with government officials. When doing government business, professional engineers must know where the lines are drawn. “In Alabama, I can’t call up a public official and say, ‘Hey, let’s go play golf.’ I can do that if we’re at a conference together and it’s around some type of training or conference activities,” says Meads. “A lot of the social things have been eliminated and there are strict rules about engagement.”

Meads is responsible for the company’s ethics training and leads an annual session for all employees. When providing ethics training, one of the strongest points he tries to get across is that professionals must take personal responsibility for knowing their ethics, no matter the challenges. “You may have an ethics officer, but as a professional engineer you have a responsibility to know the codes of ethics and the ethics laws,” he says.

In a company blog, Meads outlines the following advice on what he’s learned when it comes to handling ethical practice issues:

• Know your responsibility. As professional engineers, each of us has a responsibility to know and stay current on our state ethics laws and our professional organizations’ ethical standards.
• Communicate with competitors. There have been many times when I have called competitors to talk through situations. The goal is for us to understand the process we’re both going through and make sure we follow the ethics standards for our profession.
• Designate an ethics officer. From a corporate standpoint, it’s very helpful to have one central person to stay abreast of the requirements and educate staff about ethical issues. If you’re not sure about something, the ethics officer is someone to talk with who will provide advice.
• Maintain continuing education. It’s so important to educate your staff with regular ethics training. In training sessions, it’s helpful to put the class into small groups and give them a case study on ethics to talk through.

Access NSPE Board of Ethical Review cases, the NSPE Ethics Reference Guide, and other ethics resources.