Wuh-boy. The Washington Post’s Derek Kravitz and Mary Kay Flaherty and the New York Times’ Charlie Savage each have helpful rundowns of the rampant (forgive me if I’ve used "rampant" before so that it loses its meaning here but this is RAMPANT) corruption at the Dept. of Interior’s Mineral Management Services. There’s a lot that’s already been said about the scandal, so allow me to focus on a few main points of interest to UG readers.
The articles today concern three reports by DOI’s excellent inspector general, Earl Delvaney, on the Mineral Management Service’s royalty-in-kind program. This program generated $4.3 billion in revenue last year, as MMS gets a sixth of all oil and natural gas taken by oil and gas companies from federal lands. About 1/3 of MMS staff, though, took gifts from oil and gas executives with what the IG called "prodigious frequency." The report describes parties MMS staff had with executives from oil and gas companies that included cocaine and marijuana. MMS staff also had sexual relationships with and oil and gas executives.
Where the reports really get interesting, though, is their focus on two former MMS executives: Lucy Denett, the former associate director of Mineral Management Services, and Gregory W. Smith, the former director of the royalty-in-kind program. Denett used her position to steer consulting contracts to two former MMS employees. One of these, Jimmy W. Mayberry, has already pleaded guilty to a felony conflict-of-interest charge related to using his former MMS position to win an MMS contract.
Smith, meanwhile, has an entire IG report devoted to his exploits. He had an outside consulting job while still royalty-in-kind director, he accepted gifts from oil and gas officials, had sex with two subordinates, and purchased cocaine several times from his secretary and her boyfriend. The report alleges Smith made his drug deals during office work hours.
And now the kicker: the Justice Dept. has already said it won’t prosecute Denett and Smith. Why is this? Will Justice prosecute any other Interior officials?
Between expected Congressional oversight and its ties into the issue of offshore drilling, this story should stick around for at least a little while. Hopefully in that time we’ll know why former MMS officials aren’t being held accountable for their many, many misdeeds.-MB
You’ve heard about the FCC commissioner, Meredith Baker, who has taken a job with NBC Universal (as senior VP for government affairs, of course) just four months after voting to approve the merger between Comcast and NBC Universal. Then there’s the the too-cozy relationship between regulators at the Nuclear Regulatory Commission and the power companies they are supposed to regulate, because many employees at the NRC are aiming to land top jobs in industry when they leave government service. And let’s not forget that beyond-cozy relationships in the oil and gas regulation business helped create a culture of permissiveness that made catastrophes like the Deepwater Horizon explosion more likely. (more…)
