Yesterday, Ken Salazar, the Interior Secretary, said at a White House briefing that he planned to reopen probes into a web of ethical misconduct at the department's Minerals Management Service, which included employees accepting gifts from, and having sex with, representatives of the oil and gas companies they were supposed to be regulating.
Reports by the department's Inspector General recommended that two MMS managers implicated in the scandal be prosecuted. But the Bush Justice Department declined to bring charges, a decision that the IG, Earl Devaney, publicly criticized, telling a congressional committee last September: ''I would have liked a more aggressive approach, and I would have liked to have seen some other people prosecuted here.''
Devaney also complained during his testimony that his report had been incomplete because Chevron -- one of the companies charged with giving gifts to the staffers -- had hired lawyers for six employees implicated in the scandal who later refused to cooperate with the IG' investigation.
One of those who escaped prosecution was Greg Smith, who ran the Denver office of MMS's Royalty in Kind (RIK) program, in which the government forgoes royalties and takes a share of the oil and gas for resale instead. Smith was accused in the reports -- including one special report focused on him -- of coercing two subordinates into sex, doing cocaine with a subordinate, suggesting to other employees that they should lie to investigators, and taking $30,000 from a private company for marketing its services to oil and gas companies.
One employee told investigators that
"The RIK employee recalled that on one occasion in late 2004, Smith telephoned her repeatedly asking for drugs. She said she provided cocaine to him early that evening, but he continued to call her. Eventually, she said, Smith traveled to her house and wanted her to have sex with him. She said he also asked her if she had more cocaine, and she stated that she did not but that someone who was staying with her might. She said Smith obtained crystal methamphetamine from one of these individuals and she watched him snort it off the toaster oven in her kitchen. The RIK employee also said she and Smith engaged in oral sex that evening."
The other official who Devaney recommended prosecuting is accused of less tabloid friendly -- but equally serious -- misdeeds.
Lucy Dennet, a top official of the Minerals Revenue Management office in Washington DC, is accused of helping another MMS employee, Jimmy Mayberry, to create a lucrative MMS contract that benefited him after he left MMS. Mayberry and another former MMS employee, Milton Dial, have already pleaded guilty to creating the deal. Mayberry faces up to five years in prison.
"In the matter involving Ms. Dennet, Mr. Mayberry and Milton Dial, the results of this investigation paint a disturbing picture of three Senior Executives who were good friends, and who remained calculatedly ignorant of the rules governing post-employment restrictions, conflicts of interest and Federal Acquisition Regulations to ensure that two lucrative MMS contracts would be awarded to the company created by Mr. Mayberry - Federal Business Solutions - and later joined by Mr. Dial. Ms. Dennet manipulated the contracting process from the start. She worked directly with the contracting officer, personally participated on the evaluation team for both contracts, asked for an increase to the first contract amount, and had Mayberry prepare the justification for the contract increase. Ms. Dennet also appears to have shared with Mr. Mayberry the Key Qualification criteria upon which bidders would be judged, two weeks before bid proposals on the first contract were due."
So it looks like Smith and Dennet may not be out of the woods yet.
Salazar also suggested that he'd re-open the investigation into the activities of Steven Griles, the former Deputy Interior Secretary who was convicted of obstructing justice in connection with the Jack Abramoff investigation. More on that to come...