[Comments on Practice of Federal Officials Accepting Discounts on Purchases of Foreign-Made Cars]

In response to a congressional request, GAO determined: (1) the legality of federal government officials traveling on diplomatic passports, then accepting discounts on the purchase of foreign-made cars; (2) what regulations or guidelines would apply; and (3) whether the discounts should be considered gifts. GAO found that: (1) although there were no statutes covering the acceptance of discounts, there was an Executive Order with implementing regulations setting forth applicable rules of ethical conduct for government officers and employees; (2) questioned subsequent to the events, the Office of Government Ethics issued quidelines suggesting that discounts be considered on a case-by-case basis; (3) generally, discounts should not be considered gifts because the vendor receives consideration for the discount which induces the sale; and (4) since the instant discount was in an amount beyond the normal range and did not reflect a legitimate commercial motive, it should have been considered a gift for purposes of financial disclosure.