Sex for Oil? Reports Blast Interior Dept.

"This is unheard-of conduct, it is beyond any ethical lapse of memory or conduct," Rahall told ABC News. "We always suspected a cozy relationship between RIK employees and the oil industry."

Danielle Brian, executive director of the Project on Government Oversight, told ABC News that it "was almost impossible to use hyperbole in this case."

"I would have been embarrassed to have my teenagers acting this way," she said.

The department promised to take action to ensure this never happens again and insists there's no evidence taxpayers lost any oil and gas revenue as a result of the alleged wrongdoing.

"We take the report seriously," Randall Luthi, director of the department's Mineral Management Service, the parent division of the programs involved in the report, said today.

"We believe we've made a lot of progress. Fourteen people, I don't think, represent the culture when dealing with an agency of over 1,700 people."

"But I will say, we've lost in the public trust," Luthi said. "That's what we've got to regain."

As many as seven employees implicated in the report still work for the Department of Interior. Devaney's recommendation is to consider terminating some employees singled out in the report and for the department to consider banning them from ever working for the RIK program.

The four energy companies that allegedly plied government employees with gifts were Chevron, Shell, Hess Corp. and Gary-Williams Energy Corp., but they do not face any penalties.

In addition to the allegations that employees cozied up to the oil industry, a Justice Department criminal investigation has been opened into the matter.

"The [Justice] Department can confirm we have received one or more referrals related to matters referenced in the Department of Interior inspector general reports publicly released today," said spokeswoman Laura Sweeney. "We are unable to comment any further on those referrals, however you will note Jimmy Mayberry, referred to in one of the reports, has pleaded guilty to a felony violation of the conflict of interest law."

Mayberry, former special assistant to the associate director of Minerals Revenue Management, entered his plea last month in U.S. District Court in Washington.

The charging papers against Mayberry, filed in June 2008, claimed that he and Lucy Querques Denett, his supervisor, struck an arrangement so that he could be brought back to work as an independent contractor. Devaney noted in his letter that the Justice Department declined to prosecute Denett.

According to the court papers, in January 2003, while still employed by the Interior Department, Mayberry created his own set of proposals and bid evaluation process. A month later, after he retired, Mayberry submitted a bid for an Interior Department contract.

Among the numerous bids and the four final contracts, Mayberry "was the only bidder to receive a grade of 'excellent' on all the requirements for the position and was awarded the contract in June of 2003."

On Capitol Hill, lawmakers who have long called for greater scrutiny of the Minerals Management Service were quick to react.

"This isn't about a few renegade individuals," said Sen. Ron Wyden, D-Ore. "It's about a government agency fostering a culture of disrespect for both the public's resources and trust. It's time to clean house at the Minerals Management Service."

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