Washington – The Justice Department is investigating whether the director of a multibillion-dollar oil-trading program at the Interior Department has been paid as a consultant for oil companies hoping for contracts, The New York Times reported last week.
The director of the program, Gregory W. Smith, and three subordinates – all based in Denver – have been transferred to different jobs and have been ordered to cease all contacts with the oil industry until the investigation is completed sometime in the spring, according to officials involved.
The officials, who spoke on condition of anonymity because the investigation had not been announced publicly, said investigators are worried that senior government officials have been steering huge oil-trading contracts to favored companies.
Any such favoritism would probably reduce the money that the federal government receives on nearly $4 billion worth of oil and gas, because it would reduce competition among companies that compete to sell the fuel on behalf of the government.
The Interior Department’s Minerals Management Service, which oversees royalty collections, is now the target of multiple investigations by Congress and the Interior Department’s inspector general.
