Word: oils
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Dates: during 1970-1979
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...reason to worry. After months of slow, top-secret investigations by the Justice Department, the Department of Energy, a congressional subcommittee and several grand juries, a long list of allegations is about to be aired. So far, most of the charges are believed to center not on the big oil majors but on relatively smaller-independents. Criminal indictments are expected to be handed down for prosecution in coming months against both companies and individuals...
...oil as new. In mid-1973, the Government set up a two-tier price structure that established a low rate (now $5.34 per bbl.) for old oil already in production and, as an incentive for exploration, a higher price (now $11.87) for new finds. Under near wartime security in Houston, the Justice Department and six FBI agents are looking into charges that oil companies camouflaged the origins of old oil and sold it as new crude...
...three companies to the Justice Department for possible criminal prosecution. The records of 73 more companies in the Houston area are yet to be audited by the Government. In addition, the Justice Department is conducting an investigation, code-named Project X, into possible price manipulations by a major U.S. oil company...
Estimates of the total old-to-new switch range from 100,000 to 500,000 bbl. a day, with illegal profits running at around $6.50 per bbl. The mechanics of the switch are easy: all oil looks the same, and it is just a matter of falsifying paper work to hide its origins. The risks of being caught have been small-up to now. As one federal investigator told TIME Correspondent Rudolph Rauch: "All an oil guy had to do was look at the enforcement procedures and laugh...
...Daisy chains." Justice Department and FBI oil-fraud "strike forces," working with at least one grand jury in Tampa, Fla., are also looking into pricing swindles carried out by fuel brokers and oil companies. Some oilmen and brokers conspired to sell and resell refined oil several times among themselves, each time at a higher price with large kickbacks, before finally passing it on to an end user, who was either part of the conspiracy or especially gullible...