Information Notice 1989-02, Criminal Prosecution of Licensee'S Former President for Intentional Safety Violations

Criminal Prosecution of Licensee'S Former President for Intentional Safety Violations

ML031180476
Person / Time
Site:	Beaver Valley, Millstone, Hatch, Monticello, Calvert Cliffs, Dresden, Davis Besse, Peach Bottom, Browns Ferry, Salem, Oconee, Mcguire, Nine Mile Point, Palisades, Palo Verde, Perry, Indian Point, Fermi, Kewaunee, Catawba, Harris, Wolf Creek, Saint Lucie, Point Beach, Oyster Creek, Watts Bar, Hope Creek, Grand Gulf, Cooper, Sequoyah, Byron, Pilgrim, Arkansas Nuclear, Three Mile Island, Braidwood, Susquehanna, Summer, Prairie Island, Columbia, Seabrook, Brunswick, Surry, Limerick, North Anna, Turkey Point, River Bend, Vermont Yankee, Crystal River, Haddam Neck, Ginna, Diablo Canyon, Callaway, Vogtle, Waterford, Duane Arnold, Farley, Robinson, Clinton, South Texas, San Onofre, Cook, Comanche Peak, Yankee Rowe, Maine Yankee, Quad Cities, Humboldt Bay, La Crosse, Big Rock Point, Rancho Seco, Zion, Midland, Bellefonte, Fort Calhoun, FitzPatrick, McGuire, LaSalle, 05000000, Zimmer, Fort Saint Vrain, Shoreham, Satsop, Trojan, Atlantic Nuclear Power Plant
Issue date:	01/09/1989
From:	Cunningham R NRC/NMSS/IMNS
To:
References
IN-89-002, NUDOCS 8901030365
Download: ML031180476 (9)

4 . .

UNITED STATES

NUCLEAR REGULATORY COMMISSION

OFFICE OF NUCLEAR MATERIAL SAFETY AND SAFEGUARDS

WASHINGTON, D.C. 20555 January 9, 1989 NRC INFORMATION NOTICE No. 89-02: CRIMINAL PROSECUTION OF LICENSEE'S FORMER

PRESIDENT FOR

Addressees

All holders of a U.S. Nuclear Regulatory Commission specific license.

Purpose

This information notice is issued to remind licensees and their employees of

the penalties that could result from the intentional violation of regulatory

requirements. In particular, both the licensee and individual employees could

be subject to criminal prosecution by the U.S. Department of Justice as well

as civil enforcement action by the NRC, if they intentionally violate regulatory

requirements or commit any other type of regulatory-related wrongdoing. The

particular case described below involves wrongdoing by former licensee employees, including the former President, at a large irradiator. However, the principles

involved apply to all NRC licensees. It is expected that licensees will review

this information notice, distribute it to management and staff involved with

licensed activities, including responsible radiation safety staff, and consider

actions, as appropriate, to avoid similar problems. This information notice

does not constitute any new NRC requirements, and no written response is required.

Description of Circumstances

Radiation Technology, Inc. (RTI) operates four irradiators, two in New Jersey, one in North Carolina and one in Arkansas. Irradiators use highly radioactive

material to sterilize a variety of products, including medical supplies, spices

and certain food products. During a 1984 inspection at RTI's Rockaway, NJ fa- cility, an.NRC inspector determined that safety interlocks, designed to prevent

entry to the irradiator cell while the radioactive material was unshielded, had

been deliberately bypassed at the facility. This action was apparently taken

with the knowledge and approval of the former President, who was also the

Radiation Safety Officer. A subsequent inspection at the Rockaway facility

in 1986 revealed additional examples of operation of the facility without the

required safety interlocks in place.

In addition, NRC investigators identified examples of the President and other

company officials lying to NRC inspectors and investigators, as well as

efforts to prevent NRC from learning about the violations of regulatory

requirements; these efforts included holding a meeting to discuss what NRC

investigators would be told and then creating false documents.

890 1030365 C

IN 89-02 January 9, 1989 As a result of these findings, NRC suspended the license in June 1986; in

addition, NRC's investigation findings were referred to the United States

Department of Justice for prosecutorial review. In August 1986, a condition

for removal of the suspension and issuance of a renewed license by the NRC

was that certain RTI individuals would be prohibited from being involved in

licensed activities.

On March 18, 1988, the U.S. Grand Jury for the District of New Jersey returned

a multiple count indictment against RTI, the former President, and two former.

Operations Managers. Seven counts were directed to the former President.

RTI pleaded guilty to two counts. The former Operations Managers pleaded

guilty to one count each. The former President pleaded not guilty on all

counts. On June 28, 1988, a jury in the U.S. District Court of New Jersey

found him guilty on six out of seven criminal counts against Title 18 and

Title 42 of the U.S. Code, including conspiracy to defraud the United States, lying to NRC investigators, and intentionally violating the Atomic Energy

Act. As a result, on October 11, 1988, the former President was sentenced

to serve two concurrent sentences of two years, and was assessed a $50,000

fine. Radiation Technology, Inc. was fined a total of $100,000. The two

former Operations Managers were each sentenced to three years probation and

assessed fines of $10,000 and $2,500, respectively.

Discussion:

Licensees are responsible for ensuring the safe performance of licensed activi- ties in accordance with NRC regulations and the requirements of their licenses, and for providing complete and accurate information to NRC, relative to all

licensed activities. In cases that Involve the possession and use of large

quantities of radioactivity, full compliance is critical, because the sources

of radiation involved are capable of delivering life-threatening exposures.

The operation of a large irradiator without safety interlocks, designed to

prevent entry into the cell while the sources are exposed, compromises the

safety of the operators and other employees. In addition, it Is important

to note that NRC will not accept administrative procedures as a substitute

for the required engineered safety interlocks for irradiator operations.

The NRC expects licensee employees to be completely candid and cooperative

with NRC personnel during the licensing and inspection process. The regu- latory process functions on the premise that licensees will, at all times, provide accurate information to NRC in a timely manner. Violations of NRC

requirements caused by intentional acts or efforts to Impede the regulatory

process may subject wrongdoers to criminal prosecution. As evidenced by the

case described In this information notice, criminal sanctions may include a

fine and/or imprisonment.

IN 89-02 January 9, 1989 No written response is required by this information notice. If you have any

questions about this matter, please call the technical contact listed below

or the appropriate NRC regional office.

Richard E. Cunningham, Director

Division of Industrial and

Medical Nuclear Safety, NMSS

Jack R. Metzger, NMSS

(301) 492-3424 Attachment:

1. List of Recently Issued NMSS Information Notices

2. List of all Recently Issued NRC Information Notices

-Attachment 1 IN 89-02 January 9, 1989 LIST OF RECENTLY ISSUED

NMSS INFORMATION.NOTICES

Information Date of

Notice No.

.- Mr.P AA

Subject Issuance Isued to

bb-1uu Memorandum of understanding 12/23/78 All major nuclear

between NRC and OSHA relating materials licensees

to NRC-licensed facilities and utilities holding

(53 FR 43950, October 31, 1988) CPs and OLs, .

88-93 Teletherapy Events 12/2/88 All NRC medical

licensees

88-90 Unauthorized removal of 11/22/88 All NRC licensees

industrial nuclear gauges authorized to

possess, use, manufacture, or

distribute industrial

nuclear gauges

88-66 Industrial radiography 08/22/88 All NRC industrial

inspection and enforcement radiography licensees

88-62 Recent findings concerning 08/12/88 All holders of NRC

implementation of quality quality assurance

assurance programs by suppliers program approvals for

of transport packages radioactive material

packages

88-33 Recent problems involving the 05/27/88 All Agreement States

model Spec 2-T radiographic and NRC licensees

exposure device authorized to

manufacture, distribute

or operate

radiographic exposure

devices and source

changers

88-32 Prompt reporting to NRC of 05/25/88 All NRC materials

significant incidents involving licensees

radioactive material

88-26 Falsified Pre-Employment 05/16/88 All holders of OLs

Screening Records or CPs for nuclear

power reactors and

all major fuel

facility licensees

OL = Operating License

CP = Construction Permit

Attachment 2 IN 89-02 January 9, 1989 LIST OF RECENTLY ISSUED

NRC INFORMATION NOTICES

Information Date of

Notice No. Subject Issuance Issued to

88-23, Potential for Gas Binding 1/5/89 All holders of OLs

Supp. 1 of High-Pressure Safety or CPs for PWRs.

Injection Pumps During a

Loss-of-Coolant Accident

89-01 Valve Body Erosion 114/89 All holders of OLs

or CPs for nuclear

power reactors.

88-46, Licensee Report of Defective 12/30/88 All holders of OLs

Supp. 2 Refurbished Circuit Breakers or CPs for nuclear

power reactors.88-101 Shipment of Contaminated 12/28/88 All holders of OLs

Equipment between Nuclear or CPs for nuclear

Power Stations power reactors.88-100 Memorandum of Understanding 12/23/88 All major nuclear

between NRC and OSHA materials licensees

Relating to NRC-licensed and utilities holding

Facilities (53 FR 43950, CPs and OLs.

October 31, 1988)

88-99 Detection and Monitoring 12/20/88 All holders of OLs

of Sudden and/or Rapidly or CPs for PWRs.

Increasing Primary-to- Secondary Leakage

88-98 Electrical Relay Degradation 12/19/88 All holders of OLs

Caused by Oxidation of or CPs for nuclear

Contact Surfaces power reactors.

88-97 Potentially Substandard 12/16/88 All holders of OLs

Valve Replacement Parts or CPs for nuclear

power reactors.

88-96 Electrical Shock Fatalities 12/14/88 All holders of OLs

at Nuclear Power Plants or CPs for nuclear

power reactors.

88-95 Inadequate Procurement 12/8/88 All holders of OLs

Requirements Imposed by or CPs for nuclear

Licensees on Vendors power reactors.

OL = Operating License

CP = Construction Permit

IN 89-02 January 9, 1989 No written response is required by this information notice. If you have any

questions about this matter, please call the technical contact listed below

or the appropriate NRC regional office.

Richard E. Cunningham, Director

Division of Industrial and

Medical Nuclear Safety, NMSS

Jack R. Metzger, NMSS

(301) 492-3424 Attachment:

1. List of Recently Issued NMSS Information Notices

2. List of all Recently Issued NRC Information Notices

Editor

EKraus 12/7/88* IMNS* IMNS NMSS*

GSjoblom : RECunningham : RBernero

See previous concurrence* 12/20/88 / /89 1/3/89 OFC:IMOB* IMOB* MOB* IMAB* OE* OGC* 0I* RI*

NAME:JMetzger DCool JHickey JAustin JLieberman STreby BHayes JJoyner

DATE:11/14/88 12/15/88 12/14/88 12/16/88 12/20/88 12/27/88 11/14/88 12/7/88 OFFICIAL RECORD COPY

IN 88- December , 1988 No written response is required by this information notice. If you have any

questions about this matter, please call the technical contact listed below or

the appropriate NRC Regional Office.

Richard E. Cunningham, Director

Division of Industrial and

Medical Nuclear Safety, NMSS

Jack R. Metzger, NMSS

(301) 492-3424 Attachment: List of Recently Issued

NRC Information Notices

Editor

EKraus 12/7/88* NOB

GS4J //ui iningham : FtBernero

See previous concurrence* l 88 /2/oJ 'f/88 iI //8?

A-1 %00

OFC:IMOB* _IM

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NAME:JMetzger(Y o J Py .JA Yn VM\UN~b a v<r n g40 ayes Joyner

DATE:11/14/88 12 /V88 12 */88 12/1V88 12\M 12 P288 12 h-89 11/14/88 127/88 OFFICIAL RECORD COPY

IN 88- December , 1988 No written response is required by this information notice. If you have any

questions about this matter, please call the technical contact listed below or

the appropriate NRC Regional Office.

Richard E. Cunningham, Director

Division of Industrial and

Medical Nuclear Safety, NMSS

Jack R. Metzger, NMSS

(301) 492-3424 Attachment: List of Recently Issued

NRC Information Notices

Editorl' /

EKrausit/op/88 IMNS IMNS NMSS

,e p .e . : . concIr-e .

-1 GSjoblom : RECunningham : RBernero

Reee previous concurrence*N / /88 / /88 / /88

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OFC:IMOB* IMOB MOB IMAB GPA OE OGC 01*

NAME:JMetzger DCool JHickey JAustin VMiller JLieberman STreby BHayes JJryner

DATE:11/14/88 12 / /88 12 / /88 12/ /88 12/ /88 12/ /88 12/ /88 11/14/88 12/7/88 OFFICIAL RECORD COPY

IN 88- November , 1988 No written response is required by this information notice. If you have any

questions about this matter, please call the technical contact listed below or

the appropriate NRC Regional Office.

Richard E. Cunningham, Director

Division of Industrial and

Medical Nuclear Safety, NMSS

Jack R. Metzger, NMSS

(301) 492-3424 Attachment: List of Recently Issued

NRC Information Notices

NMSS/Editor IMNS :IMNS :NMSS

EKraus GSjoblom:RECunningham:RBernero

11AK(/88- 11/ /88:11/ /88 :11/ /88 OFC: I :IMOB :IMOB :IMAB :GPA :OE :OGC :RI

NANE:JHzg r:DCool :JHickey :JAustin :VLMiller:JLieberman:STreby :BH yes :JJoyner

- --------------------------------------------------------------- -- -- ____

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DATE:1l/ f188:11/ /88 :11/ /88:11/ /88:11/ /88:11/ /88 :11/ /88 :11 //8:11/ /88 OFFICIAL RECORD COPY