Drug Use, Cronyism Alleged Against Government Regulatory Staff


A new report issued by the Interior Department alleges that oil drilling regulators routinely violate both ethics rules and federal regulations, focusing more negative attention on the regulatory climate that may have helped contribute to the current Gulf of Mexico oil catastrophe.

Although the investigation that led to the report was a routine one, and covers events that occurred before the explosion of the BP drilling rig that killed 11 workers and touched off the month-long oil spill, the acting inspector general, Mary Kendall, has been asked to expand and continue the investigation in light of that explosion.

Among the allegations are reports that staff members at a regulatory agency, the Minerals Management Service, accepted bribes from oil and gas companies and looked at pornography on government computers. Some of the gifts that were described in the report include tickets to sporting events and restaurant meals. The Minerals Management Service, or MMS, both regulates the industry and receives royalties from it.

Additionally, says the report, there existed a culture of cronyism between the regulators and oil- and gas-industry officials.

“We discovered that the individuals involved in the fraternizing and gift exchange—both government and industry—have often known one another since childhood,” said Kendall. The report did not include specifics, but did suggest that the relationships often superseded work-related ethical considerations.

In 2007, at the time of the investigation, then-Inspector General Earl Devaney described a “culture of ethical failure” that included numerous conflicts of interest at the Minerals Management Service. That investigation, and the newly released report detailing it, focused on the agency’s Louisiana office, but previous studies had also looked into inappropriate behavior at a Denver office.

The report also included an admission from at least one staffer that he had used crystal methamphetamine, and that he might still have been under the influence of the drug while at work the next day.

Kendall sent the report to Interior Secretary Ken Salazar, whose department includes the regulatory agency. Said Salazar, the revelations of the report are “further evidence of the cozy relationship between some elements of MMS and the oil and gas industry,” adding that it was “deeply disturbing.” Salazar had previously proposed to abolish that agency and to create three new entities to replace it.

He also said that several of the employees have already resigned, been fired or been referred for prosecution. Others may yet face disciplinary action. Salazar also asked Kendall to continue the investigation.

Oil giant BP has launched its own investigation into the causes of the accident, which took place on April 20. It promises to brief federal authorities on the results of that investigation this week.


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