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Aug 31, 2010 9:16 PM by Alison Haynes

Drilling agency imposes conflict-of-interest rules

WASHINGTON (AP) - Scandalized by federal regulators who had sex
with oil company executives and negotiated with them for jobs, the
agency that oversees offshore drilling is imposing a first-ever
ethics policy that bars inspectors from dealing with a company that
employs a family member or personal friend.
Michael Bromwich, head of the Bureau of Ocean Energy Management,
said the new policy should help restore credibility toe rafts to transporgency, which was widely criticized under its former
name - the Minerals Management Service - for being too close with
oil and gas companies.
President Barack Obama and Interior Secretary Ken Salazar have
pledged to end the agency's "cozy relationship" with industry and
slow the revolving door between government and the energy industry.
Under the new policy, agency employees must notify a supervisor
about any potential conflict of interest and step aside when
inspections or other official duties involve a company that employs
a family member or close personal friend.
Inspectors who join the agency from the oil industry cannot
perform inspections or other work involving their former employers
for two years.
The new policy, which takes effect immediately, comes after a
series of jaw-dropping reports documenting the close relationship
between agency workers and energy company representatives.
In May, the Interivr Department's acting inspector general found
that MMS employees in the Lake Charles, La., office accepted meals,
football tickets, hunting trips and other gifts from the oil and
gas companies they were regulating. In at least one case, an
inspector admitted using crystal methamphetamine and said he might
have been under the influence of the drug the next day at work.
A separate 2008 inspector general report singled out workers in
the agency's Lakewood, Colo., office for having sexual
relationships with energy company executives and accepting gifts
from them.
Mary Kendall, Interior's acting inspector general, said her
biggest concern was the ease with which drilling agency employees
moved between industry and government. Inspectors and oil company
workers have often known one another since childhood, and their
relationships took precedence over their jobs, Kendall said.
The new policy is directed toward the most cleat
ut conflicts
of interest and acknowledges that drilling regulators often live
near rig workers and supervisors they see in the field. The
guidelines don't require recusal in all those situations, as long
as the neighbors have limited personal knowledge of each other and
only share general conversations.
In a memo to the drilling agency's 1,700 employees, Bromwich
acknowledged that the new policy responds to widespread criticism.
But he said it was a significant reform that "underscores the
importance of independence, objectivity and the absence of real or
apparent bias on the part of any of our employees in the discharge
of their duties."
An investigator with the Washington-based Project on Government
Oversight, Mandy Smithberger, called the ethics policy long
overdue. She also said it should be expanded to other agencies
within the Interior Department and high-ranking officials in the
agency's Washington headquarters.
Bromwich, a lawyer and former inspector general at the Justice
Department, has pledged a lifetime ban on working in the energy
industry, but Smithberger said a more formal policy restricting
political appointees from working in the industry is needed.
At least two former MMS directors have served as president of
the National Ocean Industries Association, an offshore energy trade
group. Randall Luthi, who was MMS director from 2007 to 2009, took
over the industry post in March, replacing Tom Fry, who had been
president of the group since 2000. Fry headed the drilling agency
during the Clinton administration.
A bill passed by the House in response to the BP oil spill
includes a revolving-door provision, but the measure is stalled in
the Senate.

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