Paul L. Bloom, the Department of Energy's former special counsel who distributed $4 million to four charities just before the Reagan administration took office, yesterday defended his action as a perfectly legal one within his right to do.
"The money I distributed was not taxpayers' money, it was Amoco's money paid to the government to settle a claim" Bloom said in a television interview. "And I did not distribute the money to charity; I specified to the four charities receiving the money that it was to be used as restitution for poor people to pay their overcharged fuel bills."
Whatever his legal rights to do it were, Bloom's action tripped a sensitive cord in the Reagan administration. Energy Secretary James Edwards wants the four charities to return the money. The charities say they can't return it because they've already distributed most of it to the poor and elderly to help pay their fuel bills this winter.
Bloom insisted yesterday that he did nothing wrong in sending $1 million checks to the Salvation Army, the National Council of Churches, the National Conference of Catholic Charities and the Council of Jewish Federations. Bloom said he chose those four because they had programs in place to help needy people with their fuel bills and had already identified the neediest people in their purview.
"When Amoco came in with this unexpected $4 million, I was left with a number of choices," Bloom said. "I could have sent it to the Treasury; I could have let Amoco keep it, and I could have done nothing and waited six to nine months for the Reagan administration to figure out what to do with it. I decided to do my fiduciary duty."
Bloom denied he had distributed taxpayers' money without authority. He said he had the written approval of Energy Department lawyers to do as he did. He said he did not ask Energy Secretary Charles Duncan for permission to distribute the money because Duncan had never asked him to tell how he was distributing the cash from oil company settlements of overcharge claims.
"I did not ask the secretary's permission when I brought the charge against Amoco," Bloom said. "I did not ask his permission when I settled the claims."
Bloom said the $4 million was brought in by Amoco Jan. 16 as the leftover cash from the $29 million is agreed to pay its largest customers when it settled the $100 million overcharge claim against it. The Energy Department had already put $71 million of Amoco's money into an escrow account to settle claims from smaller customers of Amoco. This money has already accumulated $4 million in interest.
"The department has said I gave away the $4 million that was earned as interest, which is taxpayers' money," Bloom said. "This is not true. I gave away the $4 million that Amoco brought in last month. It was not interest, it was Amoco's money paid to end the claim against it."