| (a) Purpose. The purpose of this section is to establish
standards of conduct applicable to financial advisors or service providers
in accordance with Tex. Gov't Code Chapters 2263, 2270, and 2252.
(b) Definitions. The following words and terms, when
used in this section, shall have the following meanings, unless the
context clearly indicates otherwise.
(1) Department--The Texas Department of Housing and
Community Affairs, (the "Department").
(2) Board--The Governing Board of the Department.
(3) Financial advisor or service provider--A person
or business entity who acts as a financial advisor, financial consultant,
money or investment manager, or broker who:
(A) may reasonably be expected to receive, directly
or indirectly, more than $10,000 in compensation from the Department
during a fiscal year; or
(B) renders important investment or funds management
advice to the Department or a member of the Board.
(c) Anti-Boycott Verification. Financial advisors and
service providers are required to comply with the requirements of
Tex. Gov't Code Chapter 2270, which requires a representation by each
financial advisor or service provider that their firm (including any
wholly owned subsidiary, majority-owned subsidiary, parent company,
or affiliate):
(1) does not boycott Israel; and
(2) will not boycott Israel during the term for which
they provide services to the Department.
(d) Iran, Sudan and Foreign Terrorist Organizations.
Financial advisors and service providers are required to comply with
the requirements of Tex. Gov't Code Chapter 2252, which requires a
representation by each financial advisor or service provider that
their firm (including any wholly owned subsidiary, majority-owned
subsidiary, parent company, or affiliate) is not an entity listed
by the Texas Comptroller of Public Accounts under Tex. Gov't Code §2252.153
or §2270.0201.
(e) Exemption from Disclosure of Interested Parties.
Financial advisors and service providers are required to comply with
the requirements of Tex. Gov't Code Chapter 2252. Financial advisors
and service providers that make a representation that their firm (including
any wholly owned subsidiary, majority-owned subsidiary, parent company,
or affiliate) is a publicly traded business entity are exempt from
Tex. Gov't Code §2252.908.
(f) Disclosures and Statement.
(1) A financial advisor or service provider shall disclose
in writing to the Executive Director of the Department and to the
state auditor:
(A) any relationship the financial advisor or service
provider has with any party to a transaction with the Department,
other than a relationship necessary to the investment or funds management
services that the financial advisor or service provider performs for
the Department, if a reasonable person could expect the relationship
to diminish the financial advisor's or service provider's independence
of judgment in the performance of the person's responsibilities to
the Department; and
(B) all direct or indirect pecuniary interests the
financial advisor or service provider has in any party to a transaction
with the Department, if the transaction is connected with any financial
advice or service the financial advisor or service provider provides
to the Department or to a member of the Board in connection with the
management or investment of state funds.
(2) The financial advisor or service provider shall
disclose a relationship described by this subsection without regard
to whether the relationship is a direct, indirect, personal, private,
commercial, or business relationship.
(3) A financial advisor or service provider shall file
annually a statement with the Executive Director of the Department
and with the state auditor. The statement must disclose each relationship
and pecuniary interest described by this subsection, or if no relationship
or pecuniary interest described by that subsection existed during
the disclosure period, the statement must affirmatively state that
fact.
(4) The annual statement must be filed not later than
April 15 in the following form. The statement must cover the reporting
period of the previous calendar year.
Attached Graphic
(5) The financial advisor or service provider shall
promptly file a new or amended statement with the Executive Director
of the Department and with the state auditor whenever there is new
information to report under this subsection.
(6) A contract under which a financial advisor or service
provider renders financial services or advice to the Department or
a member of the Board is voidable by the Department if the financial
advisor or service provider violates a standard of conduct adopted
under this section.
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