The Underground Life of the Oil Industry
On September 10, federal investigators announced that 13 former and current Interior Department employees in the Denver and Washington offices allegedly accepted golf and ski outings, received sexual favors and partied with employees from energy companies, according to CNNMoney.
Three reports released by the Interior Department's inspector general reported that the officials in charge of billions of dollars in oil royalties accepted bribes - including fixing contracts, working as private oil consultants on the side, accepting golf and ski trips and dinners, and having sexual relationships - in exchange for better business deals. The investigation was launched in 2006 after an employee in the Denver office called in to report the ethical issues.
Animal House: Government Style
CNNMoney reported that Inspector General Earl E. Devaney wrote in his report that within the Denver Minerals Management Service is a "culture of substance abuse and promiscuity." The office is in charge of marketing oil and natural gas that energy companies trade to the government in exchange for royalty payments for drilling on federal lands. The oil and gas are resold to energy companies or placed in the nation's emergency stockpile.
The investigation, which took more than two years and cost $5.3 million, concluded that employees drank alcohol at work gatherings, used cocaine and marijuana, and had sexual relationships with oil and gas company employees in the "fraternity house" atmosphere.
The report detailed specific incidents which the investigators found to be inappropriate. "Two government employees who had to spend the night after a daytime industry function because they were too intoxicated to drive home were commonly referred to by energy traders as the "MMS Chicks,"" Devaney wrote.
One oil marketer admitted to having a one-night stand with a Shell employee. Investigators also found that the same person passed out business cards for her sex toy business at the office, telling her fellow coworkers that her salary from the business was well over what she earned at the Interior Department.
Christmas Came Early for Some Employees
According to CNNMoney, from 2002 and 2006, about a third of 55 employees staffed in the Denver office were given gifts from oil and gas companies. The companies that passed out the gifts were Chevron Corp., Shell, Hess Corp. and Gary-Williams Energy Corp. Two employees, in particular, were given gifts on 135 different occasions.
The reports also detail that the former head of the Denver royalty-in-kind office, Gregory Smith, abused cocaine, had sexual relationships with his employees and directed contracts to a consulting business that, in return paid him. It is believed that Smith received $30,000 from the consulting company between April 2002 and June 2003.