Ethics issues, sex, cocaine scandal at Interior Dept.

[moegolden]

I didn't know if this is ultimately Bush-related, but it is a Cabinet dept., so I think its fair game.

http://www.nytimes.com/2008/09/11/washington/11royalty.html?hp=&pagewanted=all

Wide-Ranging Ethics Scandal Emerges at Interior Dept.

By CHARLIE SAVAGE
Published: September 10, 2008

WASHINGTON — As Congress prepares to debate expansion of drilling in taxpayer-owned coastal waters, the Interior Department agency that collects oil and gas royalties has been caught up in a wide-ranging ethics scandal — including allegations of financial self-dealing, accepting gifts from energy companies, cocaine use and sexual misconduct.

In three reports delivered to Congress on Wednesday, the department’s inspector general, Earl E. Devaney, found wrongdoing by a dozen current and former employees of the Minerals Management Service, which collects about $10 billion in royalties annually and is one of the government’s largest sources of revenue other than taxes.

“A culture of ethical failure” besets the agency, Mr. Devaney wrote in a cover memo.

The reports portray a dysfunctional organization that has been riddled with conflicts of interest, unprofessional behavior and a free-for-all atmosphere for much of the Bush administration’s watch.

The highest-ranking official criticized in the reports was Lucy Q. Denett, the former associate director of minerals revenue management, who retired earlier this year as the inquiry was progressing.

The investigations are the latest installment in a series of scathing probes of the troubled program’s management and competence in recent years. While previous reports have focused on problems the agency has had in collecting millions of dollars owed to the Treasury, the new set of reports raises questions about the integrity and behavior of the agency’s officials.

In one of the new reports, investigators conclude that a key supervisor at the agency’s minerals revenue management office worked together with two aides to steer a lucrative consulting contract to one of the aides after he retired, violating competitive procurement rules.

......
(a lot MORE i am not able to paste)

[DanaReevesLungs]

A political scandal? I've never heard of such a thing.;)

Sir, your source is the New York Times speaking poorly about Republicans...this is obviously slanted.:icon_roll

[Stig]

I'm pretty sure that all Interior Department employees aren't members of the same political party.

[moegolden]

OK, how about the Rupert Murdoch-owned WSJ?
One thing they did teach me in journalism school is that for having a conservative editorial slant, the WSJ is fairer in their reporting of news.

http://online.wsj.com/article/SB122107135333120223.html


Interior Department Employees
Probed Over Alleged Improprieties
By STEPHEN POWER
September 10, 2008 4:57 p.m.

WASHINGTON -- Employees of the federal agency in charge of collecting royalties from oil and gas companies accepted gifts from industry representatives, engaged in "sexual relationships with industry contacts" and engaged in "alcohol abuse" while socializing with industry representatives, the Interior Department's top watchdog said.

A report by the department's inspector general, Earl Devaney, which was released Wednesday, is expected to recommend disciplinary action for up to a dozen employees of the Interior Department's Minerals Management Service, people familiar with the matter said. A summary of the report said the report also criticizes "the refusal of one major oil company - Chevron - to cooperate with our investigation."

The Interior Department scheduled a news conference with Randall Luthi, the MMS's director, to respond to Mr. Devaney's latest report. Chevron didn't immediately return calls for comment.
RELATED DOCUMENTS

• Investigative Report of MMS Oil Marketing Group -- Lakewood
• Investigative Report of Gregory W. Smith

The inspector general's findings shine a light on the MMS's internal culture in recent years, and come at a politically sensitive time, with Congress weighing proposals to expand offshore drilling. The agency manages the nation's natural gas, oil and other mineral resources on the outer continental shelf, and last year collected more than $11 billion in royalties from oil and gas companies.

In some years, MMS has been the second-largest source of revenue for the U.S. Treasury, behind only the Internal Revenue Service. Any expansion of offshore drilling would further broaden the influence of the agency, whose duties include drawing up leases for drilling on offshore waters.

In recent years, Mr. Devaney's office has blasted Interior Department officials for tolerating bureaucratic mistakes that allowed oil companies to avoid paying royalties for offshore drilling rights. Government auditors have estimated such mistakes will cost taxpayers as much as $10.5 billion over about 25 years.

Mr. Devaney's latest report focuses on MMS's royalty-in-kind program, under which the government receives oil instead of cash as royalty payments from companies leasing federal property for oil and gas development. Under the program, which began as a series of pilot projects during the Clinton administration but was expanded under the Bush administration, the government typically sells the oil into the marketplace, and returns the proceeds to the Treasury. Sometimes it places some of the oil into the Strategic Petroleum Reserve, an emergency oil stockpile.

Interior Department officials said the program results in higher revenue collections and lower administrative costs for the government. But government watchdogs, including Mr. Devaney's office, have long criticized what they described as lax management controls over the program. Critics say the program has inappropriately benefited the industry and created at least the appearance of favoritism for certain energy companies.

In May, a report by Mr. Devaney's office said an investigation of the program found that "the integrity of the [royalty-in-kind] oil sales process is undermined by poor business practices," with companies often allowed to modify their bids after the submission deadline. Of 718 bid packages awarded to companies between 2001 and 2006, the report said, 121 were modified, with only three modifications favoring the government. The value of the modified bid packages not in favor of the government was $4.4 million, according to the report.

In a summary of his latest report, released Wednesday by congressional oversight committees, Mr. Devaney blasts "a culture of ethical failure" at the MMS, where agency employees "donned a private sector approach to essentially everything they did." The report says that between 2002 and 2006, one-third of the agency employees assigned to the royalty-in-kind program "socialized with, and received a wide array of gifts and gratuities from, oil and gas companies" with whom they were conducting government business.

"We discovered a culture of substance abuse and promiscuity in the RIK program -- both within the program, including a supervisor…who engaged in illegal drug use and has sexual relations with subordinates and in consort with industry," a summary of Mr. Devaney's report said. The report adds that some agency employees "also engaged in brief sexual relationships with industry contact. Sexual relationships with prohibited sources cannot, by definition, be arms-length."

Wednesday's report is the latest black eye for the Minerals Management Service. In July, a top aide at the agency pleaded guilty in U.S. District Court to violating conflict-of-interest laws. The employee, Jimmy W. Mayberry, 65 years old, acknowledged helping create a consulting position that he was hired for after retiring from government.

[DonTheTrucker]

One more reason I will not be voting for George Bush this November.

[Stig]

One more reason I will not be voting for George Bush this November.
Fool me once, shame on you.
Fool me twice, shame on me.
Fool me three times, I blame the blacks.