When critics talk about regulatory officials being in bed with those they regulate, the phrase is typically used metaphorically. At the Department of the Interior, however, it should be taken literally.

The Interior Department's Inspector General, who has been investigating the U.S. Minerals Management Service's Royalty-In-Kind program, said government employees who were supposed to be regulating the oil companies were engaging in drug use and having sex with industry contacts. "Several staff admitted to illegal drug use as well as illicit sexual encounters," Inspector General Earl Devaney wrote in a Sept. 9 memo to Interior Secretary Dirk Kempthorne released today.

The Royalty-In-Kind program allows oil companies to pay royalties to the government in oil rather than cash. Between 2002 and 2006, "these employees accepted gifts and gratuities on at least 135 occasions from four major oil and gas companies with whom they were doing business" according to the Inspector General's report. [more ...]