ML20043E573
| ML20043E573 | |
| Person / Time | |
|---|---|
| Issue date: | 08/06/1988 |
| From: | Joseph Kelly NRC OFFICE OF INSPECTION & ENFORCEMENT (IE REGION IV) |
| To: | Martin R NRC OFFICE OF INSPECTION & ENFORCEMENT (IE REGION IV) |
| Shared Package | |
| ML20043E518 | List: |
| References | |
| FOIA-89-540 NUDOCS 9006130153 | |
| Download: ML20043E573 (12) | |
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DATBt August 6,1988 MBMOR&NDUM FOR: Robert tin, Regional ministrate fg IROM Janes A. F. Roll eoph BUBJBCT Stroneous Cha Made By O!A It has been verbally brought to my attention that the NRC's Of fice of Inspections and Audits has reported that I acted in conflict of interest.
It is my understanding that these charges concern inspection activities at the South Texas Project and it was reported that I sought employment from the licensee in violation of regulations.
I categorically deny that I ever sought employment with the Houston t.ighting and Power Company.
About eighteen months ago I volunteered to you that informants within the STP security organisation had alerted me to derogatory statements made by Nuclear Security Manager Mr. Andrew Hill.
I was informed that Mr. Hill had announced to his stati that there was a malicious cause to their licensing difficulties.
Mr. Hill was alleged to have stated to his staff that he had re$ected the applic:ation of James Kelly for employment and NRC inspectors were retaliating.
This was a fabrication.
I requested that you take the matter up with HL&p management to surf ace the truth.
At that time, I briefed you that in the 1g81 time frama a responsible member of the utility approached na about the mechanics of negotiating with me in behalf of ML&P.
I discussed it with regional c'ounsel at that time in 1981 and followed procedures.
Nothing materialized from that approach and further communication about that subject was discontinued.
Sometime later the utility employed Mr. A.
Hill.
As a refresher, when ! was approached in 1981 by Mr.
Parker, of HL&P Corporate Security, there was no Nuclear Security Department.
There was no inspection of STP security underway.
Mr. Hill did not then work at STP but rather was an inspector for the NRC at Region 2.
You elected to refer this self reported matter to CIA for investigation.
It is my understanding from Mr. Goldberg, ML&P Vice President, that STP management concluded that their was no substance to Mr. Mill's allegation.
Concerning the validity of my inspection findings, you will recall that the cognizant licensing office (NRR safeguards) concurred with those inspection findings.
The NRC's Office of Investigation's ef forts confirmed that certain records had been falsified and some security incidents were not reported Investigation by the State of according to regulations.
Texas confirmed that the training was inadequate and records had been altered.
NRC inspection finding af ter inspection finding documented STP's security program inadequacies.
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1 These findings were not only in the security personnel area bat aise in the procedural developeant, intrusion detection systems' installaties and perf ormsace, and the fault badginq system.
Civil penalties have been levied a paid.
Tet, OMA's quest ' to discredit un and the STP socorit inspction effort grinds on.
I pasonally believe t t 1, my fellow security inspectors au our Divistenal leadership, i
performed a remarkable task.
The remarkableness of our efforts was further enhanced by overcoming the obstacles of j
slander, f also allegations, and intimidating. internal l
4 InvestigatJons that were placed in our way.
J Last week I was advised that DIA was reporting, as 4 new 1
matter, that in August of 1987 I sought employment with HL&P.
The charge is supposedly based on a conversation that I had with Mr. Larry George of STP security.
Again !
categorically eeny that I sought employment with HL&P.
This charge is further compounded by an alternate charge.
The I
alternate charge is that I may have been seeking employment i
not for myself but f or Mr. Caldwell, a fellow MRC security inspector.
I categorically deny that alternate charge as well.
o!A's flawed conclusion is based on a f aulty premise.
It was Mr. Caldwell who decided that he wanted to approach Mr. Vaughn, Vice President of STP, about the security manager's position.
At that time, August of 1987, I was conducting an onsite inspection at STP.
Mr. Caldwell telephoned me at the site to inform me of his plan and to notify me that he was following procedure.
I counseled against such an application because I believed that it would provide the utility a tool to counter future inspection t
I findings.
I was confident that they would have no interest i
in employing one of the inspectors who had been among their nousses.
I simply thought it was a bad idea and said so.
Mr. Caldwell elected to gc through with his approach anyhow.
Later in the same day Mr. Caldwell called me again to report that he had discussed this matter with Mr. Vaughn.
According to Mr. Caldwell, Mr. Vaughn replied that it was not a workable idea.
Af ter that call, but on the same day,
.L.had a private discuss 1wn with Mr. besty otorge enout the matter.
eor sevecert ;rvara, nr. usurvs nao pewn Anforming me about internal STP probless.
As a point of information, Mr.
George was in no position to help anybody get employment at STP.
He was vulnerable himself to the shifting STP I
personnel tides, but I believed that he might be able to l'
anform me of any STP adverse reaction to the re$ected l
Caldwell approach.
I did not supply any name's and it l
became apparent during the conversation that he was unaware l
of Mr. Caldwell's rejected approach.
Later in the week Mr.
l George said he found no information about any NRC inspector l
applying for the position.
In an ef fort to stem further L
speculation I told him it was Mr. Caldwell and that Mr.
Vaughn had declined.
The matter was never discussed again but apparently Mr. George made a memo to his record about the inquiry.
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t In conclusion, I believe that I performed an in the service of the health and safety of th applaudable $ob our region.
i-have served as a caution nationally to otherFurther, I consider the falsification of r orts s who alght the nuclear regulatory process.ecords in an effort to evade t
in a way that was beneficial to the advanceme profession and have encouraged others to ** nt of m cea Jia.xtr**a-- * - " * **"*d t *' E t ever course is necessaryW a'11t C I intend to pursue co casprove these falsehoods, l
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ij U. S. NUCLEAR REGULATORY COMMISSION NRC MANUAL Volume: 0000 Geners' Administration Part : 0700 Inspections, Investigations and Appraisals CIA CHAPTER 0702 NOTIFICATION AND INVESTIGATION OF MISCONDUCT 0702-01 COVERAGE This chapter covers NRC's procedures for having misconduct of NRC and con-tractor employees reported to and investigated t,y the Office of Inspector and Auditor. This chapter doe.s not apply to employees of NRC licensees or their contractors.
0702-02 OBJECTIVES 021 To assure that all facts in connection with alleged or indicated misconduct or improper actions of NRC and contractor employees are gathered through an impartial investigation and reported ta the Commission or the Executive Director for Operations.
022 To assure that each employee who may be guilty of misconduct or improper action will be disciplined in the same manner as others under similar concations regardless of his position in the organization.
w 0702-03 RESPONSIBILITIES AND AUTHORITIES 031 Employees _ shall report to the Director of their Office all allegations including fraud, graft, corruption, and diver-or indications of misconduct, sion of NRC assets,' of NRC and contractor employees; however when the exigencies of the circumstances dictate,- employees may make such reports directly to the Office of Inspector and Auditor.
032 The Directors of Offices:
report to the Director, Office of Inspector and Auditor,12 :Jega-a.
tions. or indications of misconduct, including fraud, graft, corrup-g tion, and-diversion of NRC cssets, of NRC and contractor employees..
take necessary action as a result-of the Office of Inspector and b.
Auditor investigations as socn as possible.
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Approved: November 26, 1979 f-\\D f
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NRC-6702-083 NOT!TICATION AND INVESTIO..IlOK QE MISCONDVCT 4
7 c.
submit a statement in duplicate to the Director, Office of Inspector e
and Auditor, within 30 days after receipt of the investigative report V
indicating what action has been taken on the basis of the investiga-tive report or explain why further action was not deemed necessary.'
033 The Director, Office of Inspector and Auditor:
investigates and reports on all alleged or ind'icated misconduct of a.
NRC and contractor employees.
b, discusses' the results of investigations with and furnishes copies of reports to the ' Commission, the Executive Director for Operations, or ti.e responsible NRC, official, as appropriate.
c.
maintains records of all allegations, investigations, and action
- taken, d.
approves release of investigative riports to other governmental agencies when required for use in conducting official business, refers any suspected or alleged cruninal violations to the Depart-e, ment of Justice, after appropriately informing or consulting with the Office of the General Counsel, f,
maintains liaison with the Federal Bureau of Investigation and other A
law enforcement agencies on all cruninal and other investigative I, J matters.
g.
maintains liaison with the Special Counsel, Merit Systems Protection l
Board.on all investigative matters.
l 0702-04 DEFINITIONS Misconduct as used herein applies to misconduct of any kind as identified in Chapter NRC-4124, " Conduct of Employees," and includes fraud, graf t,
corruption and diversion of NRC assets or any conduct prejudicial to the Government.
s 0702-05 BASIC REQUIREMENTS 051 Applicability. The provisions of this chapter are applicable to and shall be followed by au NRC Offices, including their contractor employees.
052 Access to Invesdradve Report, Investigative reports shall not be made available to persons under a.
investigation, except as provided otherwise by statute or regulati.n (e.g., the Freedom of Information and Privacy Acts).
W Appr0ved: November 26, 1979 b
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s, In* determining the esataua reasonable penalty the Herit Systems Protection 3eard will consider the fe11 swing factors (1) he nature and setiousness of the of fanse, and its relatten to the sopioyee's duties, position and responsibilities, including whother the of fease was intentional er techatsal.or taadworteet, or was committed maliciously or for gain, or was frequently repeatedt the ' employee's job level and
- type of employment, including supervisory -
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(2) or fiduciary role, contacts with the pubite, and prominence' of the pes'ition (3) the employee's past disciplinary recordt
( 4. )
the employee's past work record, including length of service, periore ance on the job, ability to get along with faltas workers, and -
dependabilityl (5) the ef fect of the of fense upon the employee's abA11ty to periore at a satisfactory level and its effect upon supeareisors' confidence in the employee's ability to perfore assigned dua& ass.
(6) consistency of the penalty with those imposed upam other employees for the same or similar offenses (7) consistency of the penalty with any applicable agency table of penaltie s; (8) the notoriety of the of fense or its impact upon the reputation of the agency; t9) the clarity with which the employee was on notice of any rules that were violated in committing the of f anse, or had been warned about the conduct in question; (10) potential for the employee's rehabilitation (11) mitigating circumstances surrounding the offensa such as unesval' job tension, personality problems, mental impai.rumet, harassment, or bad faith, malice or provocation on the part of others involved in the matter; and (12) the adequacy and ef fectiveness of alternative sanctions to deter such conduct in the future by the employee or others.
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UNITED STATES i
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NUCLEAR REGULATORY COMMISSION g
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ANNOUNCEMENT NO. 46 DATE: May 24, 1984 I
l ALL NRC EMPLOYEES 1,
BU,BJ CT:
ANFORMATION REGARDING CONFLICTS OF INTEREST (10 CFR PART 0) b!$ny of you have recen'tly submitted Confidential Statements of Employment and Financial Interests (NRC Form 269) or' Financial Disclosure Reports (Form 278).
This office is-currently reviewing the statements.
We will write individual letters to those of you who have stockholdings and/or outside employment which could possibly present a conflict of interest or appearance of impropriety.
These letters will remind employees not to participate in matters affecting organizations in which they hold a financial interest 4
subject to the $1,000 de minimis rule described below.
Organiza-tions listed in the leTt'ers will be entities which are not found on the prohibited stockholding list, but which are engaged in activi-l l
ties in the commercial nuclear field or either have or may poten-tially have business before the Commission.
l This year, like last, most employees who-filed such statements will not receive individual letters regarding their statements from this office.
Many employees reported that they had no reportable stockholdings or other-financial interests.
In addition, persons who listed interests such as holdings in real property, personal loans, and other investments and associations of a kind unlikely to l
present a conflict or possible-conflict with NRC employment will' i
not receive individual letters.
It also seems appropriate at this time to review the major provi-sions of our conflict of interest regulations.- No Commissioner or other employee, including special government employees who are members of the ACRS, the ASLBP, or the ASLAP, who occupies a position at or above GG-13 or its equivalent, or spouse, minor child, or other member of the immediate household of a Commissioner l
or such employee, shall own any stocks, bonds or other security interests issued by:
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filed an application with the Commission requesting an early site review, or seeking authorization to construct or operate a facility for the generation of electric energy by means of a nuclear. reactor or utilities which have received a construction permit or an operating license from the Commission that is currently effective.
2.
State or local governments, if the primary purpose of the security is to finance the construction or operation of a nuclear reactor.
3 Companies manufacturing or selling nuclear power or test reactors.
Architectural-engineering companies that have been 4.
engaged by an applicant for a construction permit or.
for an operating license to provide services relating to a nuclear tacility, and architectural-engineering companies which have filed a standard reference design that is unoer Commission review or has been approved by the Commission and is currently effective.
Companies licensed by the Commission to mill, 5
convert, enrich, fabricate, store, or dispose of source or special nuclear material, or applicants for such licenses.
This stock ownership prohibition also applies to individuals below the GG-13 level who provide input into the NRC decisionmaking See NRC Announcement No. 29 dated April 20, 1984 for a process.
list-o*. those occupational categories covered.
Employees may own an unlimited amount of stocks, bonds, and other security interests in companies not falling within the above classifications, but may not participate as an NRC employee in matters affecting those entities if the current value of the-holdings exceeds $1,000, or constitutes more than it of the dollar value on the outstanding shares.
Baployees and members of.their
' family covered by the stock ownership restrictions may not purchase prohibited securities for their Individual Retirement Accounts (IRA).
Employees may own an unlimited amount of shares in diversi-fled mutual funds.
Employees may not participate in matters
-affecting any organization in which they serve as an officer, director,. trustee, partner, or employee, or with which they are negotiating or have any arrangement concerning prospective employ-These restrictions also apply if the-employee's spouse, ment.
minor child or partner holds such a position.
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3 Full-time cammission employees require written authorization before accepting any employment, fee, compensation, or payment of expenses from Commission-licensees (including universities), license appli-cants, organizations directly engaged in ac tivities in the commer-cial field, Commission contractors, Agreement-State licensees,-
nuclear trade associations, Commission suppliers, or law firms or other organisations which are participating in an NRC proceeding or which regularly represent themselves or clients before the NRC.
Employees who work for offices reporting to the Commission through the Executive Director for Operations must receive written approval from the Executive Director for Operations.
Employees working for offices reporting directly to the Commission must receive written approval from their office head.
The procedures for obtaining approval are spelled out in NRC regulations, 10 CFR 0.735-40.
NRC employees are precluded from accepting any gift, gratuity, favor, meal, or any other thing of monetary value from Commission licensees and others regulated by the Commission, with a few exceptions which are spelled out in 10 CFR 0.735-42.
Food and refreshments may be accepted from applicants, licensee, contractors, or vendors, only when it occurs on infrequent occasions in the ordinary course of a luncheon or dinner meeting or other meetings or on an inspection tour where an employee may properly be in attendance.
In many cases reimbursement will be required.
When questions arise, employees should contact'OGC.
OGC frequently receives questions regarding the restrictions on contracts with the agency by former NRC employees.
The restrictions imposed by the Ethics in Government Act fall into three-categories:
(1)
There is a permanent ban on acting ns another person's representative (basically making any written or oral communication with intent to influ-ence the Federal Government) to the Government on any case, contract, application or other particular matter involving a specific-party and in which the former employee participated " personally or substan-tially" while employed by the NRC.
(2)
There is a two-year ban'on such representation-involving particular. matters and specific parties on matters which were actually pending under the former employee's official responsibility within one year prior to termination of that responsibility.
(3)
Most employees classified as SES, GG-17 or above are subject to more restrictive conditions, including (a) a permanent prohibition on assisting in represen-tation by' personal presence at any formal or informal appearance on benalf of anyone other than the United States in connection with any particular matters involving a specific party in which he or she i
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personally and substantially participated, as well as ' (b) a one-year ban on contacting the NRC with intent to influence agency action on any matters pending before, or of substantial interest to the agency.
These restrictions are explained in greater detail in the regula-tions promulgated by the Office of Personnel Management in FCfK' uF37, a copy of which will be given to all professional employees at Copies are also available upon the time they leave the NRC.
request from Personnel Operations, Mail Stop W-417, 492-8227.
NRC has promulgated administrative procedures to enforce the post-employment restrictions.
They have been published as NRC Appendix 4124, Part VI.
For your information we are providing the following summary of some OGC conflict of interest advise that we have provided to employees in recent months.
An NRC employee was named co-trustee-of a trust established 1.
for the benefit of his parents.
The employee inquired whether He in that capacity he could manage prohibited securities.
was advised that he could not.
Either the prohibited securi-ties should be sold or the co-trustee (who was not an NRC employee) should be given total responsibility for the manage-ment of the prohibited stock.
2.
An employee inherited prohibited stock.
We advised the employee to divest herself of the stock within six months.
(Determinations regarding the appropriate divestiture time are made on a case-by-case basis.)
Until divestiture took place, the employee was advised she could not participate in matters affecting that company.
3.
An NRC employee was invited to an awards dinner hosted by a reactor vendor.
The employee was told-that he could attend if he reimbursed the vendor for the reasonable price of the dinner.
4.
Jm NRC employee sceted that he wished to negotiate for employ-ment with an NRC.'icensee.
We advised the employee that once he submitted e resume to the utility he would be precluded from working en rhtters for the NRC affecting that licensee.
If negotiations wados unsuccessfully, he could resume working on matters affectiag that company.
If the employee's NRC job did not require him to work on matters affecting the utility, he was under no obligation to inform his supervisor that he a
was negotiating for employment.
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A university licensed by the NRC asked an NRC employee to give a lecture at the university.
The university offered the employee an honorarium.
OGC advised the employee that the speech could be treated as one of his NRC duties, in which case he could not accept the honorarium from the university.
Alternatively, he could accept the honorarium if he took annual leave, and received prior written authorization from the EDO to accept the honorarium.
'6.
A non-supervisory NRC employee accepted employment with'a utility that he had inspected.
We told him that his prior NRC employment did not restrict his activities for the utility, except that he could not represent the utility before the NRC on any enforcement action that he had participated in while an NRC' employee or on any inspection report t. hat he had assisted in the preparation of during his NRC tenure.
OGC wishes to thank all NRC employees for the excellent record of compliance with the Commission's conflict of interest regulations.
If therE cre any questions on the issues discussed in this memo-randum, or any other questions pertaining -to 10 CFR Part 0, please contact-Mary Sweeney or Darlene Collins in the Office of the-General Counsel.
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m ames A. Fitzgerald Assistant General Counsel i
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