No More Sex, Drugs and Gifts
Interior dept. head pledges to change cozy relations b/w agency, oil industry.
September 18, 2008— -- Inexcusable. That's how the Secretary of Interior described the conduct of his employees, who did drugs as well as accepted gifts and engaged in illicit sexual relationships with oil industry officials they did business with.
And that's why the secretary, Dick Kempthorne, told members of Congress today that he would step up ethics oversight of the office where the scandal occurred.
"I am outraged that the public's trust, an important and necessary part of public service, has been abused," Kempthorne said.
His testimony today before the House Committee on Natural Resources came as a result of three reports last week from the department's inspector general outlining a pervasive culture of coziness, gift giving and inappropriate sexual relationships between officials at the Mineral Management Service and in the oil and gas industry.
In his testimony, Kempthorne said he planned to place an attorney-advisor in the Denver, Colorado office, where the MMS scandal was centered, to directly oversee ethics and compliance issues. And he said he had tightened up management at the suggestion of the inspector general, who noted that many of those breaking ethical rules had bypassed reporting to their direct supervisor in Denver in favor of someone with less daily oversight in Washington.
In a series of reports, the inspector general found numerous ethical lapses at MMS, which manages federal natural resources on the Outer Continental Shelf on federal and Indian lands. It is one of the largest income generators outside of taxes for the federal government, with more than $8 billion in revenue.
The inspector general found that three individuals had been involved in a conflicts of interest contracting scheme in which officials helped a former employed win a lucrative contract. Two individuals -- Jimmy Mayberry and Milton Dial -- have pled guilty in connection with the scandal but a third, contracting officer Lucy Querques Denett, was not prosecuted by the Justice Department, despite recommendation from the inspector general.
The Justice Department also declined prosecution of another individual highlighted in the reports, Greg Smith, former head of the Royalty-in-Kind program. The inspector general found that Smith, who has since left government service, accepted gifts and engaged in inappropriate sexual relationships and illegal drugs and tried to secure work for his private consulting business from oil and gas executives with interests in his office's work. Smith's attorney has said that the report was unfair and inaccurate.
Another report also implicated nearly a third of the RIK staff in accepting and soliciting gifts from oil and gas executives.
But above all, Inspector General Earl Devaney testified today that "the single-most serious problem portrayed in these reports is a pervasive culture of exclusivity" in which the employees showed "a callous disregard for the rules by which the rest of us are required to play.
In reference to the report on Smith, Kempthorne said "the details of this report are profoundly disturbing" and planned to initiate proper disciplinary action -- including termination -- for those who were part of the scandal.
"I am committed to an ethical culture at the Department," he said.
Indeed, Devaney added: "I believe that the environment of MMS today is decidedly different than that described in our reports."