Energy Dept. loan program needs more transparency, report says

The Energy Department’s inspector general absolved the department’s Loan Program Office of any wrongdoing in contracting law firms, but recommended more transparency in the office’s conflict of interest policy, according to a new report.

The IG launched an investigation into Energy’s law firm contracting policies after receiving various anonymous reports related to “improprieties” in how the agency was hiring outside attorneys to review its loan applications.

The inquiry, however, “did not substantiate the specific allegations outlined in the complaint,” the inspector general, Gregory Friedman, wrote in his report. “Absent additional information, we plan no further action regarding the original allegations.”

The report identified areas where the Loan Program Office can improve its contracting policies, pointing to a lack of a tracking system to spell out which law firms had been granted waivers to the requirement to detail any conflicts of interests. Friedman recommended creating such a system and documenting rationale explaining why any waivers are granted.

Tracking issues had been noted in March in a Government Accountability Office report and an audit from the Energy IG’s office in 2011.

In response to the recommendations, Energy management told the IG’s office “that the Loan Programs Office is in the final stages of developing and implementing a state-of-the-art records management system” to address the issues raised.

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