Oil spill highlights conflict-of-interest issue within investigation agency

By Carol D. Leonnig
Washington Post Staff Writer
Saturday, July 31, 2010

David Dykes -- the federal regulator now leading his agency's investigation of the BP oil spill -- has spent five years as a senior investigator and office chief enforcing oil industry safety in the Gulf of Mexico. For much of that time, his brother was a top executive at an energy company with significant activities under Dykes's purview.

But David Dykes did not formally recuse himself from matters involving his brother's company. No rule required him to do so. Unlike many federal agencies that make employees distance themselves from matters involving friends, relatives or former bosses, the nation's chief oil regulatory agency had no such policy.

Now, in the wake of the BP disaster, Congress is pressing the agency formerly called the U.S. Minerals Management Service to clamp down on potential conflicts of interest. The case of David and Rodney Dykes highlights the challenges of the task. The oil industry of the Gulf Coast is an insular world in which rig foremen and the federal inspectors charged with regulating them sometimes work side by side, or grew up in the same towns and even homes.

Investigations into the BP spill have focused on whether MMS regulators properly oversaw the Deepwater Horizon rig or merely accepted company assurances that the rig was safe. An inspector general investigation in May showed that MMS regulators in the gulf sometimes viewed themselves more as industry friends and fishing buddies than policemen. In one office, they took free trips, sporting tickets and gifts from industry officials they were supposed to be monitoring, the investigation found.

(More here.)