by Eric Martin
Government should just get out of the way of big business, de-regulate, allow self-regulation, lax oversight, ignore capture, etc.:
Federal regulators responsible for oversight of drilling in the Gulf of Mexico allowed industry officials several years ago to fill in their own inspection reports in pencil — and then turned them over to the regulators, who traced over them in pen before submitting the reports to the agency, according to an inspector general’s report to be released this week.
The report, which describes inappropriate behavior by the staff at the Minerals Management Service from 2005 to 2007, also found that inspectors had accepted meals, tickets to sporting events and gifts from at least one oil company while they were overseeing the industry.
Although there is no evidence that those events played a role in the Deepwater Horizon oil spill, the report offers further evidence of what many critics of the Minerals Management Service have described as a culture of lax oversight and cozy ties to industry.
The report includes other examples of troubling behavior discovered by investigators.
In mid-2008, a minerals agency employee conducted four inspections on drilling platforms when he was also negotiating a job with the drilling company, a cover letter to the report said.
And an inspector from the Lake Charles office admitted to investigators that he had used crystal methamphetamine, an illegal drug. Investigators said they believe the inspector may have been under the influence of the drug during an inspection.
The report was provided to The New York Times by a person familiar with the investigation who is not authorized to speak to reporters. Previous inspector general investigations of the minerals agency have focused on inappropriate behavior by the royalty-collection staff in the agency’s Denver office.
The new report describes similar activities and improper relationships with industry representatives in the leasing and inspections staff in an agency gulf region office in Louisiana.
The report found that employees from the Lake Charles office had repeatedly accepted gifts, including hunting and fishing trips from the Island Operating Company, an oil and gas company working on oil platforms regulated by the Interior Department.
Taking such gifts “appears to have been a generally accepted practice,” said the report, written by department’s acting inspector general, Mary L. Kendall.
This latest report is consistent with prior reports investigating the same agency - though perhaps less salacious in certain respects. As I'm sure many recall, this article from 2008 details other, more lurid abuses:
As Congress prepares to debate expansion of drilling in taxpayer-owned coastal waters, the Interior Department agency that collects oil and gas royalties has been caught up in a wide-ranging ethics scandal — including allegations of financial self-dealing, accepting gifts from energy companies, cocaine use and sexual misconduct.
In three reports delivered to Congress on Wednesday, the department’s inspector general, Earl E. Devaney, found wrongdoing by a dozen current and former employees of the Minerals Management Service, which collects about $10 billion in royalties annually and is one of the government’s largest sources of revenue other than taxes.
“A culture of ethical failure” pervades the agency, Mr. Devaney wrote in a cover memo.
The reports portray a dysfunctional organization that has been riddled with conflicts of interest, unprofessional behavior and a free-for-all atmosphere for much of the Bush administration’s watch. [...]
The investigations are the latest installment in a series of scathing inquiries into the program’s management and competence in recent years. While previous reports have focused on problems the agency had in collecting millions of dollars owed to the Treasury, and hinted at personal misconduct, the new reports go far beyond any previous study in revealing serious concerns with the integrity and behavior of the agency’s officials.
In one of the new reports, investigators concluded that Ms. Denett worked with two aides to steer a lucrative consulting contract to one of the aides after he retired, violating competitive procurement rules.
Two other reports focus on “a culture of substance abuse and promiscuity” in the service’s royalty-in-kind program. That part of the agency collects about $4 billion a year in oil and gas rather than cash royalties. [...]
...Senator Bill Nelson, Democrat of Florida, suggested that Congress should not lift its ban on offshore drilling — a hot-button issue in his state — because of the problems identified.
The report says that eight officials in the royalty program accepted gifts from energy companies whose value exceeded limits set by ethics rules — including golf, ski and paintball outings; meals and drinks; and tickets to a Toby Keith concert, a Houston Texans football game and a Colorado Rockies baseball game.
The investigation also concluded that several of the officials “frequently consumed alcohol at industry functions, had used cocaine and marijuana, and had sexual relationships with oil and gas company representatives.”
The investigation separately found that the program’s manager mixed official and personal business. In sometimes lurid detail, the report also accuses him of having intimate relations with two subordinates, one of whom regularly sold him cocaine.
A free-for-all of libertines and libertarians.
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