Rep. John D. Dingell (D-Mich.) has called on the Energy and Justice departments to step up efforts to press the investigation and eventual criminal prosecution of oil executives alleged to have fraudulently overcharged consumers an estimated $2 billion over the last four years.
The Michigan Democrat, in letters sent last week to Energy Secretary James R. Schlesinger Jr. and Attorney General Griffin Bell, said that both agencies have lagged in investigating the so-called oil reseller fraud cases. The letters, which were released by Dingell's staff, questioned "the failures of the Department of Energy criminal enforcement program."
Dingell also said DOE and the Justice Department should provide more attorneys, auditors, and investigators to assist the U.S. attorney in Houston, W. A. (Tony) Canales, with a grand jury investigation of reseller cases.
The oil reseller cases involve a number of companies that allegedly resold price-controlled "old oil," bought at about $5.25 a barrel, for the $13.50-a-barrel uncontrolled oil price. FBI officials have said they hope to win criminal reacketeering indictments for the alleged illegal profiteering.
Last September the Post reported that Summit Gas Co; a Houston-based crude oil reseller company that was half-owned by Denver multimillionaire Marvin K. Davis; Coral Petroleum Inc.; Uni Oil Inc.; Westland Oil Development Corp., and Armada Petroleum Corp. were targets of the grand jury investigation.
DOE has referred nine comanies to the Justice Department for criminal violation since last spring.
Canales told House investigators that he expects the grand jury to hand down some indictments in January, including the executives of one major oil reseller company and a prominent Texas oilman.
Dingell, in a staff memorandum sent to Bell and Schlesinger, also scored DOE and its predecessor agency, the Federal Energy Administration, for not referring any criminal reseller cases to the Justice Department from 1974 until earlier this year. In the past, Dingell has been highly critical of Doe/'s efforts to enforce the department's complicated oil pricing regulations.
Dingell also said he plans to hold oversight hearings early next year.