Scandal in the Department of the Interior

Wins Ethics Award and Rocked by Ethics Scandal in Same Week

L.L. Woodard
The U.S. Department of the Interior made news twice this week and, in an oxymoronic twist, once for being on the receiving end of an annual award bestowed by the federal Office of Government Ethics (surely an oxymoron in there, too), then later in the week became newsworthy for the revelation of a scandal involving the Denver-based office of Mineral Management Services (MMS). The royalty-in-kind division of the MMS is embroiled in an oil-and-sex scandal.

The royalty-in-kind division, which in 2007 handled $4.3 billion in payments from energy companies drilling on federal lands, is in charge of the program whereby energy companies give the government oil in lieu of cash, which the MMS office then sells on the open market (H. Josef Hebert, AP).

But some of the staff of the royalty-in-kind division are alleged to have taken their division's title much too literally, with accusations of sex between staff members within the division and with reps of the oil and gas companies, drug use of staff and with members of the energy company reps, and reception of gifts such as ski trips, along with alcohol use and abuse.

The allegations come after a two year, $5.3 million investigation by the Interior Department's Inspector General Earl E. Devaney. The investigation alleges that as many as 19 staff members-a third of the royalty-in-kind division's staff-were involved from 2002-2006 in receiving gifts and gratuities from oil and gas company reps (Hebert).

Interior Secretary Dirk Kempthorne is quoted to have said that he was "outraged by the immoral behavior, illegal activities and appalling misconduct of several former and long-serving career employees" (Hebert). Randall Luthi, MMS Director, has said he is taking the allegations "extremely seriously" and "would weigh taking appropriate action in the coming months" (Hebert).

It may be difficult to take Luthi at his word, however, as the inspector general included in his report that the staff of the royalty-in-kind office "had effectively opted out of the Ethics in Government Act in practice, and at one point, even explored doing so by policy or regulation" (Derek Kravitz, The Washington Post).

If it weren't so ludicrous, one might laugh that the thing which brought the Department of the Interior its award by the Office of Government Ethics was a "dynamic, laminated Ethics Guide," small enough for the employees to carry (Kravitz). "Additionally the Department held a four-day seminar for its ethics advisers nationwide" (Kravitz). Apparently the ethics adviser who attended from the MMS office took the seminar to mean "for everyone but us."

Without trying to sound like a conspiracy theorist, one has to wonder about the timing of the release of the inspector general's report just when Congress is wrestling with what to do about off-shore oil drilling. The investigation concluded in 2006; two years to compile and release the investigation's results seems...lengthy. But that's by the standards of private industry, not the special standards to which the federal government holds itself.

As a taxpayer and U.S. Citizen, I'd like to demand some accountability. Accountability from the 19 staff members of the MMS office who are named in the inspector general's report. Accountability for an investigation that covered two years and cost a whopping $5.3 million hard-earned taxpayer dollars. Accountability by the people who oversee the MMS office, and accountability by the people who oversee the overseers.

If private industry functioned in the manner our federal government does, businesses would go belly-up on a daily basis. Considering the national debt, it could be said that our federal government went belly-up a while ago; it's just one of those amazing fish who can survive out of water for a while-but not forever.

Published by L.L. Woodard

Freelance writer/editor and freelance observer of life. Three decades of nursing experience in long-term care, from development of team care planning to hands-on patient care.  View profile

  • Department of the Interior received an annual award from the Office of Government Ethics this week
  • An oil-and-sex scandal was revealed this week involving the Mineral Management Service
  • The scandal was revealed by a two-year $5.3 million investigation
The award bestowed by the Office of Government Ethics to the Department of the Interior is for excellence portrayed in the area of ethics.

4 Comments

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  • Kerry9/29/2008

    what a disgrace!

  • Michael Segers9/25/2008

    Great report on this.

  • Donna Porter9/19/2008

    Scandal-free business and politics is a rarity these days...oil and sex...eh? Nice work.

  • Patricia Sicilia9/13/2008

    I've got news for you -- private business DOES operate this way. They just call it CEO bonuses and perks! What an ironically slippery situation!

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