Section 5.4 - Conflicts of Interest(a) A conflict of interest exists whenever financial advisors and service providers have a personal, private, commercial, or business relationship that could reasonably be expected to diminish their independence of judgment in the performance of their responsibilities for the commission or the department, including where an action taken by the financial advisor or service provider reasonably appears to be influenced by considerations of personal gain or benefit rather than motivated by the interests of the commission and the department.(b) Financial advisors and service providers shall promptly disclose in writing to the executive director any relationship the financial advisor or service provider has with any party to a transaction with the commission or the department, other than a relationship necessary to the investment or funds management services performed for the commission or the department, when a reasonable person would consider a conflict of interest to exist because of that relationship.(c) Financial advisors and service providers shall promptly disclose in writing to the executive director all direct or indirect pecuniary interests the financial advisor or service provider has in any party to a transaction with the commission or the department, if the transaction is connected with any services and advice provided to the commission and the department.(d) Financial advisors and service providers shall annually file with the executive director and the state auditor a statement disclosing each relationship and pecuniary interest described by subsections (b) and (c) of this section, or a statement that no such relationships or pecuniary interests existed during the disclosure period. The statement shall be in the form prescribed by the department or the state auditor. A revised statement shall be promptly filed whenever a new relationship subject to subsection (b) of this section is entered into or a new pecuniary interest subject to subsection (c) of this section is created.(e) Financial advisors and service providers shall promptly disclose in writing to the executive director any other possible conflicts of interest. Written disclosures sent to the executive director under this subsection or under subsection (b) of this section shall contain actions proposed by the financial advisor or service provider to avoid conflicts of interest. Financial advisors and service providers may not give advice or provide services relating to a matter affected by the possible conflict of interest unless the executive director or designee waives this prohibition in writing.43 Tex. Admin. Code § 5.4
The provisions of this §5.4 adopted to be effective January 8, 2004, 29 TexReg 227