Sex, Cocaine and Oil:an American Scandal

Employees of an agency in the U.S. Interior Department are accused of involvement in a huge corruption case which includes both substance abuse and promiscuity.

The case could hardly have come to light at a worse moment. Just as Congress is preparing to debate the lifting of the moratorium on offshore drilling – a top priority for the Bush administration – the government agency responsible for oil development finds itself mired in a corruption scandal which could be summed up as “sex, drugs and oil companies.”

A report drawn up by Earl Devaney, the Interior’s Inspector General, points the finger at 19 of the agency’s employees, a third of its total staff. The agency in question is the Minerals Management Service, based in Denver, Colorado.

After an enquiry lasting “more than two years”, cost $5.3 million, questioned 233 witnesses and examined 470,000 pages of documents and emails, Devaney has accused the 19 employees of operating in a “culture of ethical failure, substance abuse and promiscuity” between January 2002 and July 2006.

For four and a half years, the employees, who were responsible for “royalties-in-kind” (the share of oil which oil companies give to the government in exchange for drilling rights), “socialised with” oil company staff and received “a wide array of gifts” from the companies with which they were doing business, such as Chevron or Shell.

Two employees too drunk to drive

Two of the employees received gifts of restaurant meals, concerts tickets, sports events, golf and skiing afternoons, “on 135 occasions from four major oil and gas companies”. American government officials are not allowed to accept gifts worth more than $20, and the total value of gifts offered by any one company must not exceed $50 per year.

Worse yet, employees often consumed alcohol, cocaine and marijuana while at work. Some female employees, nicknamed the “MMS chicks”, even had sexual relations with oil company representatives.

The report cites the example of one afternoon when two employees were too drunk to drive and so were given overnight accommodation by Shell.

Several employees also had jobs outside the agency, but did not report their income from those jobs on their financial disclosure forms as they were supposed to do.

Indeed the memo which accompanies the report reveals that several of the executives themselves were no less corrupt. Lucy Q. Dennet, who is now retired and thereby protected from prosecution in the immediate future, “manipulated the contracting process from the start”, to the financial benefit of one of her friends.

Another department executive “deliberately secreted the true nature of his outside employment” as consultant for a company, for which he received a $30,000 salary.

The author of the report has recommended that the employees who are still in post should be dismissed immediately.