ML20128E593

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Forwards Ofc Rept of Investigation Into Allegations by T Applegate Re Facility.W/O Rept
ML20128E593
Person / Time
Site: Zimmer
Issue date: 08/19/1981
From: Schnebelen A
NRC OFFICE OF INSPECTOR & AUDITOR (OIA)
To: Thompson D
NRC
Shared Package
ML20127A137 List:
References
FOIA-84-415 NUDOCS 8505290422
Download: ML20128E593 (1)
v • d • e


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NUCLEAR REGULATORY COMMISSION j

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August 19, 1981 l

1 Office of Inspector and Auditor

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Note to Dudley Thompson

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the allegations by Thomas Applegate regarding l

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the Zimmer Nuclear Power Station.

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Ar hur Schnebelen Acting Assistant Director n-C for Icvestication

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UNITED STATES

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NUCLEAR REGULATORY COMMISSION I

I wassmoton, n.c.zosse 4.,,..

September 17, 1981 MEMORANDUM FOR: Chairman Palladino FROM:

William J. Dircks Executive Director for Operations

SUBJECT:

JUL'Y 30, 1931 OIA REPORT. "SPECIAL INQUIRY RE: ADEQUACY OF IE INVESTIGATION 50-358/30-9 AT THE WILLIAM H. ZIMMER.

NUCLEAR POWER STATION" Enclosed are the OIE coments relative to the OIA. investigative findings. I would like to specifically direct your attention to the enclosed weld chron-ologies. Clearly, these welds had been identified and placed in a corrective action system prior to Applagate's involvement.

I believe the CIA report summary (page 2) best characterizes the safety issue.

"One cf Applegate's main allegations was that defective welds in safety-related systems have been accepted. * * *.

8.y virtue of prior IE inspections * * *. it is clear that Region III was well aware of the chronic and long history of welding problems at Itmer: specifically, that unacceptable welds in safety-related systens had for all intents and purposes been accepted by both the contractor and, in some casas, the licensee. Based upon these inspections, Region III required the licensee to rereview radiographs and reports cf all welds which had been accepted for turnover prior to operationi this review started in October 1979 and portions of this review are still being studied by Region III."

It appears to be irrelevant to debate whether or not the welds had been accepted; the pertinent fact is that the welds were in a systen to obtain corrective action.

l I am confident that the ag'gregate of licensee and NRC actions would have resulted in adequate welds prior to the operation of this plant. irrespective

  • of Applegate's involvement.

r Willia J. Dircks Executive Director for Operations

Enclosures:

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Office'of'In'spection and Enforcement Conraents

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Weld Chronologies cc: See Page 2

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William J. Dir.cks r'

Esecutive,Direc, tor fdr Operations 5UBJECT:

. JULY 30,198101A REPORT, ' ADEQUACY OF IE INV' STICATION E

50-358/80-09 AT THE WILLIAM H. IIMMER NUCLEAR POWER STAT 10M" The DJA findingt and supporting arguments contained in the August 1981 memorandum J. Cunknings to the Coimissioners, disturb me deeply. I==

ferced to conclude that DIA may not clearly understand the NRC mission or priorities, nor the processes and controls involved in the construction of a nucle'ar power plant.

I am dnable to conclude that the ole investigation L

. of Applegate's allegations was unsatisfactory.

Our goal-for plants under construction is 'to ensure that they are' constructed t;

a manner.to provide adequate public protection after they are licensed operate. We attempt to ensure,that all potential cont.truction defects.

1rrespective of how they are identifled, are adequately corrected prior to the operation of a nuclear power plant. To that end, the sptimal use of our rosources is achieved when identified defects are,vwified to be in a utility's corrective action system. The potent fal for further reduction L

of risk to the public is not conpensurate with the incronental resources rcquired to broaden the depth and breadth of this type of investigation as suggested in the OIA report.

J have been inform +d there are factWal inaccuracies in the CIA r'eport.

will 4e forwarding our det' ailed ccree,nts on the CIA report in a separat.e comorandum.

William J Oireks Executive Ofrector for I

Operations cc: See next page

TACT : 'T. L. Harpster, IE 49 24774 6

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The OTA.tbiwnent on documentation (page 2) refers to the Rill investi-gative file, rather than the investigation report itself. They noted that rio "results of interview" or copies of tweld documentation review!

i were in the file. On page 13. it is pointed out that no identification key was generated for the investigative file.

fleither MAC, IE, nor Rl!! procedures require a "resvits of intervies"

'i to be generated for each interview, and all interviews are not reestred to be portrayed in detail in an investigation report.

Investigation

' reports should contain all pertinent information, whether obtained through o~ servations, records er interviews, concerning the matter in-o vestigated.

There is no need for retention of copies of all documentation obtained during an.investication.

If a document appears to be relevant to the i

case, it is of ten reviewed onsite..and no copy is obtained If a-doed-o ment appears rentral to an allegation, it is then copied, and may be

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made an attacirnent to the report, !f warranted by the issue involved.

2.

DIA Finding It investigative report did not ideni.ify the dates on which.the welding rework was conduc t ed on weld K-811..,

Discussion Although tha IE investigetton report did not identify thr date when weld K-811 was removed (approximately.1snvary 16, 19R0), the repcrt did correctly identify that the weld had been removed as provided by the disposition of NR Ho. E-213821. Thus, the weld alleged to be improper was noneutstent, having been removed eighty-two days prior to the investigation. team's arrival at Itapsr. Determination of the date of rework was not necessary in our view.

3.

01A l'inding r

I The IE investipation report did not identify that a nonennfomance report (NR) on weld K-811 had initially been closed with the notation " accept as is," and was later voided and reopened to order the weld cut out.

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flR was conditional in that it only applied if a radiograph showed t t er. v,e weld to be acceptable.

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The, investigation did not detersmine that weld RH-42 had been Cut out anf g

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1 i-The finding is correct.

f The investigation did, however, properly deter-mine that weld defects had been identified and corrective action w planned.

The actual date of corrective action is not significant.

5 O_lA Findir.t

. Nnne of ~the welds alleged to have been deficient were investigation team nor was all pert!nent weld documentation reviewed. inspected b S

Discussion The finding is correct but considered irrelevant. The imestigators did not inspect the wel(s but did r'eview the radiographs, which was the correct method of evgluation. Visual examination of the weld would not identify internal defects. The investigators did not review all weld documentation but d!d review the pertinent documentstion to establish proper weld dispositinr..

6. $ rir.dinc The It investigators did not fully investigate or accurately report on the alteration of a noncomforance report (NR) related to spool pieces containing defective welds.

The 1E re as s "CGSE official

  • vice OA Manager,prt only identified an individual thus obscuring that this was the licensee's senior person responsible for the site QA program who ordered improper voiding of a NR.

Discussion _

, Investigator Phillip indicates that the metter was discussed with his i

supervisor, and the pursuit of who directed the lining-out was seen as having litt1_e significance.

This was because a separate x had beer.

opened, providing tracing of the nonconformance.

Tinally, neither CIA i

  • nor QlE could substantiate the allegation.

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Executive, Director for 0;iepation SUSJECT:

, JULY 30, IcEl 0!A REPO'RT, 'ADIQ.;*CY OF IE INYtSTICO!Ofi 5p-359/80-09 ATTHEWILLIf?.H.IIV.::ER1;U;LEARP0i:Ep.

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STATION" The DIA findings and supporting argumen,ts contained in thd Aupst F,1981 menorandum, J. Cuarnings to the Colonis' toners, disturb me. deep 9y I as s

forced to concludd that 0!A may not clearly understand the NRC mission or priorities, nor the processes and controls involy'ed in the construction of a duele'er power plant.

I am dnable to conc 10de that the,0!E investigation

. of Applegate's allegations was unsatisfactory;

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Our goal for plants under construction is 'to ensure that they are' constri'cted f.

  • n a manner.to provide adequate,public prote' tion af ter they are licensed c

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.o. operate., We attempt to epsure that all potential construction defects,-

irrespective of how they are identif.ied, are adequately corrected prior to the operation of a nuclear power plant.

To that end, the optimal use of our resources is achieved. shen identified defects are, verif,ted to be in a utility's corrective ai: tion systen. The potential for ferther: reduction of ri$k to the publit is not conenensurate with the incremental resourews' required to broaden'the depth and breadth of this type of investigation as suggested in,the CIA report.

I have been informed there are facidal inaccuracies in the OIA r'eport.

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.wih be forwarding our det'alled'connents on the OIA report in a separate

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William J. Dircks

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Executive Director for Operations cc: See next page WTACT:

T. L. Harpster. IE I

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The 0!A,tbienent on documentation gative file, rather than the inves(page 2) refers to the Rll) investi

  • tigation report.itself. They'noted

, that rio'"results of interview" or copies of keld documtatation reviewed were in the file.

key was generated for the investigative file.On page 13, it is painted

.g fief ther NRC, IE, nor.RIII procedures re's

.s quire a "rtsvlts o'f interview"

to.be por,trayed in detail in an twestigation report.to be

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reports should contain all pert 1 pent information', whether.obtafoodI'nvestigation through observations, records.or interviews, t;oncerning the matter'fe-

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during an investigation-There is no need for retention of copies of all docum case it is of ten reviVwed onsite, And no copy is obtained.If m docum

. raent appears. central to an allegation, it is then cDpied, and may be.

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made an attachment to the report, if warranted by the issue involved.

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QIA Findino

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If investigative report did wot identify the dates on which the weld rework was conducted on weld K-811...,

11scussion

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Although the IE investigation report did not identify' the'date shen weld K-811 was renoved (approximately January 16 1980), the report did disposition of NR No. E-2138RI.correetly identify that the weld had been was nbnexistent', having been removed. eighty-tw6 days prior.to theThus investigation. team's arrival at 21mer.

rework was not necessary in nur view. -

Determination of the date of 3

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1s," and was later volded and reopened 'to order the p

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The actual date of corrective action'is not significant.

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None of the weid.s alleged to have been deficient were inspected by the e

investigation team nor was all pertinent eld documentation reviewed.

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t Discussion The finding is correct but considered irrelevant.

did not inspect the wel(s but did review the radiographs, which ws:The invest

. the correct method of evgluation. Visual examinatio'n of the weld would -

not identify internal defects. The investigat6rs dia..not review all weld documentation but did review the pertinent documentstion to establ,ish proper weld disposition.

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The.1E investigators did hot ful,1y investigste or aciu'rately report er.

1 the alteration of a noncpforance report (fir) related to spool pieces t

containing defective welds.

as s "CG&E. official" vice *QA Hanager,prt only identified an individual-The 1E re j

thus obscuring that this was the licensee's senior person responsible for the site QA prograts who ordered i

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improper voiding of a NR.

D'iscussion.

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supervispr, and the pursuit of who directed the lining-out was seen as having litt1.e significance;

.3 opened, providing tracing of the nonconforr.ance.This was because a separa N

Finally,neithefOIA

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w wts K -s7s S.EP 4 1981 R. F. Warnick, Chief, Inactor Projects Section 23 Mets)tABDCat 701:

A. Bert Dav'.s Deputy Director FIgaga ment INTEJTIGATIDS, WELD CT-516 ggi/gC/#86

SUBJECT:

As you know weld CT-516 was jetarmined to have _adf a=*4ans when it was This weld is La a system where BT is not required; the radiographed.

I understand based MDE for welds in this syetar is visual inspection.

on the IT that the licosase pisas. to cut out and replace this weld.

If the liosasee is deias th a becaese the 32 has shown that the weld is unseceptable for the ser.ica ine=ad=d, them this casta questicos os Ils than need to make an ev=1a=*4-other welds in this systaan.

whether the other velds nee 1 to be further reviewed. If, on the other hand, the licensee is repla:ing CE-316.just because the weld indications have come to the attention of somy people, than there weeld be no reason to become concerned aboet odner wlds la the system.

Plasse determine the ressac for replacing CT-516 and if appropriata, assure other velds in the syntam are reevelusted.

A. Bert Davis Deputy Director cc F. A. Barrett D. E. Danielsea C. E. Morelius

1. L. Spessard E. D. Ward t,

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UNITED STATES NUCLEAR REGULATORY COMMISSION REGION 111 1

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3 MEMORANDUM FOR: James G. Keppler, Director, Region III f

FROM:

James E. Foster, Investigator

SUBJECT:

SUPPLEMENTARY COMMENTS ON OIA REPORT " ADEQUACY.OF I&E INVESTIGATION 50-358/80-09 AT THE WILLIAM H. ZIMMER NUCLEAR POWER STATION" I have reviewed the subject report several times now, and have supplementary

-comments to add to my meno of September 3,1981.

One major point in,the CIA report is where they indicate (page 3, botton) "it j

was suspected and later confirmed that many of the [ GAP] allegations described in the petition were, in fact, not brought to the attention of Region III per-sonnel at the time of the initial investigation." This conclusion is apparently based on a two month review of GAP-supplied material and other information.

No information is provided regarding the GAP-supplied information studied or which allegations were determined to be subsequent to the Region III investiga-tion, or the method of confirmation of their suspicions. Mr. Phillip believes that the sole " confirmation" was his statements to OIA personnel. The finding is one of the central findings of the report, apparently involving two months i

work, but is given only one short paragraph in'the report.

Less significantly, the following errors were noted:

Location Error Transmittal, Page 1 Wrong date for OIA report (report was apparently finalized July 30, 1981).

Transmittal, Page 2 No mention of W. Ward involvement in investigation.

Page 2, Paragraph 4, Line 8 Region III did not " require" this action, it was a licensee response.

Page 8, Paragraph 1, Line 5 Wrong title for Schwiers, Manager, QA&S.

Page 23, Paragraph 2, Line 9 Duane Danielson.

Page 29, Paragraph 2, Line 4 Tom Daniels.

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i James G. Keppler.

Page 31, Paragraph 2, Line 8 Ed Lee.

Page 39, Paragraph 1, Line l' February 19, 1981 date appears to be in error if comment on document request (page 34, paragraph 5, line 3) is correct.

Page 39, Paragraph 2, Lines 4, Date is actually 1980.

5, and 8 c k s, J. E. Foster Investigator e

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HEMORANDUM FOR: James G. Keppler, Director, Region III FRON:

James E. Foster, Investigator

SUBJECT:

SUPPLEMENTARY COMMENTS ON OIA REPORT " ADEQUACY OF I&E INVESTIGATION 50-358/80-09 AT THE WILLIAM H. ZIMMER NUCLEAR POWER STATION" t'

I'have reviewed the subject report _several times now, and have supplementary comments to add to my meno of September 3,.1981.

One major point'in the OIA report is where they indicate (page 3, bottoa) "it was suspected and later confirmed that many of the [ GAP] allegations described in the petition were, in fact, not brought to the attention of Region III per-sonnel at the time of the initial investigation." This conclusion is apparently based on a two month review of GAP-supplied material and other information.

No information _is prov'ided regarding the GAP-supplied information studied or which allegations were determined to be subsequent to the Region III investiga-

-tion, or the method of confirmation of their suspicions. Mr. Phillip believes that the sole " confirmation" was his statements to OIA personnel. The finding is one of the central findings of the report, apparently involving two months work, but is given only one short paragraph in'the report.

Less significantly, the following errors were noted:

Location Error Transmittal, Page 1 Wrong date for 0IA report (report was apparently finalized July 30, 1981).

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Transmittal, Page 2 No mention of W. Ward involvement in investigation.'

Page 2, Paragraph 4, Line 8 Region III did not " require" this action, it was a licensee response.

-Page 8, Paragraph 1, Line 5 Wrong title for Schwiers, Manager, QA&S.

l Page 23, Paragraph 2, Line 9 Duane Danielson..

Page 29, Paragraph 2, Line 4 Tom Daniels.

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I James G. Keppler.

Page 31, Paragraph 2, Line 8 Ed Lee.

Page 39, Paragraph 1, Line 1 February 19, 1981 date appears to be in error if comment on document request (page 34, paragraph 5, line 3) is correct.

Page 39, Paragraph 2, Lines 4, Date is actually 1980.

4 5, and 8 J. E. Foster Investigator I

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James G. Keppler, Director, Region III FROM:

James E. Foster, Investigator

SUBJECT:

SUPPLEMENTARY COMMENTS ON OIA REPORT "

INVESTIGATION 50-358/80-09 AT THE WILLIAM R

&E POWER STATION"

. ZIMMER NUCLEAR comments to add to my meno of September 3,1981.I have

, and have supplementary One major point in the CIA report is where the in the petition were, in fact, not brought to thwas suspected a allegations described sonnel at the time of the initial investigation "e attention of Region III per-based on a two month review of GAP-supplied mate i l This conclusion is apparently ra and other information.

which allegations were determined to be subsequNo inf p e information studied or tion, or the method of confirmation of theirent to the Region III investiga-that the sole " confirmation" was his stateme t suspicions.

Mr. Phillip believes is one of the central findings of the report n s to OIA personnel. The finding work, but is given only one short paragraph in th, apparently involving two months e report.

Less significantly, the following errors were not d e:

Location E!!9L Transmittal, Page 1 Wrong date for CIA report (report was Transmittal, Page 2 apparently finalized July 30, 1981).

No mention of W. Ward involvement in investigation.

Page 2, Paragraph 4. Line 8 Region III did no't " require" this action i

it was a licensee response.

Page 8, Paragraph 1, Line 5 Page 23, Paragraph 2, Line 9 WrongtitleforSchwiers, Manager,1A&S.

I-Duane Danielson.

Page 29, Paragraph 2, Line 4 i

Tom Daniels.

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James G. Keppler.

Page 31, Paragraph 2, Line 8 Ed, Lee.

Page 39, Paragraph 1, Line 1 February 19, 1981 date appears to be in error if comment on document request (page 34, paragraph 5, line 3) is correct.

-Page 39, Paragraph 2, Lines 4, Date is actually 1980.

5, and 8 J. E. Foster Investigator i

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September 17, 1981 MEMORANDUM FOR: Chairman Palladino FROM:

William J. Dircks Executive Director for Operations

SUBJECT:

JULY 30,1981 OIA REPORT, " ADEQUACY OF IE INVESTIGATION 50-358/80-09 AT THE WILLIAM H. ZIMMER NUCLEAR' POWER STATION" The OIA findings and supporting arguments contained in the August 7,1981 memorandum, J. Cummings to the Comissioners, disturb me deeply.

I am forced to conclude that DIA may not clearly understand the NRC mission or priorities, nor the processes and co'ntrols involved in the construction of a nuclear power plant. I am unable to conclude that the OIE investigation of Applegate's allegations was unsatisfactory.

Our goal for plants under construction is to ensure that they are constru::ted in a manner to provide adequate public protection after they are licensed to operate. We attempt to ensure that all potential construction defects, irrespective of how they are identified, are adequately corrected prior to the operation of a nuclear power plant. To that end, the optimal use of our resources is achieved when identified defects are verified to be in a utility's corrective action system. The potential for further reduction of risk to the public is not commensurate with the incremental resources required to broaden the depth aad breadth of this type of investigation as suggested in the OIA report.

I have been informed there are factual inaccuracies in the OIA report.

I will be forwarding our detailed coments on the OIA report in a separate memorandum.

t Will J. Dircks Executive Director for Operations cc: See next page T

CONTACT :

T. L. Ha'rpster, IE 49-24774 i

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Chairman Palladino.

cc: Commissioner Gilinsky

- Commissioner Bradford Commissioner Ahearne

. Commissioner Roberts SECY OPE OGC OIA e

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POLICY ISSUE M "J Y/

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The Ccamissioners

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Subject:

INVESTIGATIVE J11RISDICTION OF THE OFFICE OF INS?ECTION N'D ENFORCEMENT

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Purpose:

To clarify the authority of the Office of Inspection and Enforcement to conduct external investigations within the

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jurisdiction of the NRC.

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i Discussion:

Two NRC offices have been delegated the authority to conduct investigations: the Office of Inspection and i

Enforcement (IE) and the Office of Inspector and Auditor (OIA). There has been a continuing lack of clarity regarding the investigative jurisdiction of II as compared to that of OIA. This has resulted in problems affecting the effective functioning of both offices. The purpose of this paper is (1) advise the Commission of this problem 1

because of its unpact on both II and OIA operations and (2) to seek Commission clarification of its desires in this f

area.

It is my view that the distinction between the 2

investigative responsibilities and authority of the two offices should be determined by whether the matter to be investigated is internal or external, rather than on the basis of whether potential criminality is involved. By 4

internal I mean that the focus of the investigation involves the NRC and its employees or contractors; by

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external I mean that the focus of the investigation involves the licensed nuclear industry'or a matter of NRC regulatory interest.

I believe that IE has and should have exclusive authority and responsibility for the conduct of all external investi-gations and that OIA has and should have similar exclusive authority for the conduct of internal investigations..In this regard the official Delegations of Authority embodied in the NRC Manual Chapters as well as Chapter 1 of 10 CFR pertaining to the two offices are instructive. Manual Chapter 0113 (as well as 10 CFR 1.30) pertains to OIA.

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W. Ward, IE

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. 1 This Chapter and 10 CFR 1.30 establish OIA as an internal investigative and auditing organization.

3 In contrast, Manual Chapter 0127 (as well as 10 CFR 1.64),

gives IE a broad external investigative mandate.

Among other things, it confers on IE the responsibility to investigate licensees, their contractors or suppliers, applicants, individuals, and any organization subject to NRC jurisdiction.

MC 0127 describes the purpose of these investigations as being "to ascertain the status of com-pliance with NRC requirements" and to " identify condi-tions...that may adversely affect the public health and safety, the common defense and security,.the environment, or the safeguarding of nuclear materials and facilities."

In addition, HC 0127 specifically charges II to "investi-gate incidents, accidents. allegations, and other unusual circumstances involving ma,tters in the nuclear industry which may be subject to NRC jurisdiction..."

Neither the Manual Chapter nor the regulation limit II's investigative role in natters that may involve potential criminality.

I The issue of authority as specified in the NRC Hanual and Regulaticus notwithstanding, there are several other compelling reasons that lead me to conclude that IE requires a clear external investigative mandate.

For instance, it appears,to me that it is inconsistent to have CIA perform external investigations, thus involving a Commission staff office in an operational activity.

1 Commission policy has been to place operational activities under the cognizance of the Executive Director for Opera-

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tions. Assigning external investigative authority to OIA 1

represent: a departure from this practice.

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Even more important, however, is the impact of OIA involve-ment in external investigations on the inspection and enforcement program in general and on enforcement coordin-ation in particular.

Indeed, tha neeMm alr*adv encoun-t tered in such investiestions at South Texas, NoMaar N

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various.TMI investigations have demonstrated the need to i

have this conflict corrected. In these cases, all of which involved potential criminality as well as major health and-s'afety issues, it is not clear that all developed information has been provided to IE or the Department of Justice, enforce-i ment actions have been delayed, and licensees have been confused J

by having to deal with two sets of NRC investigators. The Department of Justice has been brought into some of these matters with only limited II consultation regarding the program implication of such an action. The latter has i_

caused elevated enforcement actions to be held in abeyance

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f pending DOJ ru nitttien of relativelv m W c-M m14 v There have also been occasions waere D0J has declined

}g prosecution in cases where IE believed prosecution to 1

be warranted for reasons of program impact.

Relatedly, there have been instances where IE Enforcement meetings with licensees have led to NRC/I.icensee Agreements 3

a which were later challenged by DOJ. The Niagara Mohawk, Stepan Chemical, & Nuclear Pharmacy cases are examples where this has occurred.

These examples point out the need for II's authority to I

deal directly with DOJ regarding those external matters that II investigates. This would afford IE an oppor-tunity to ensure that all relevant information is made available to DOJ in a manner sufficient for DOJ to understand the relationship of the data to the public j

health and safety. Such direct contact would also 2

enhance mutual understanding of the respective roles of DOJ and NRC, and could be expected to shorten the length of time that it now requires to obtain a prose-

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cutive determination. I believe these factors demon-strate that the present procedures that require II to 2

deal with DOJ via a third party are not satisfactory, and provide no discernable benefit to the NRC.

In the above-cited investigations, CIA involvement was predicated on evidence of apparent criminality.1 It is my view that investigations of actual or potential cri-minality are only a subset of each of the larger cate-tories of internal versus external investigations. Hence, it is instructive to examine the topic of criminality in light of our experience to date.

' Pursuant to section 221(b) of the Atsmic Energy Act, the y9I is required to investigste all alleged or suspected criminal violationTof the Atomic.

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  • 4-t As it pertains to the NRC, actual or potential criminalit can be considered as falling into two categories.

sations (or is broesht to the attention of 3

The other fashion) and is only peripheral to NRC's principal interest or responsibilities.

Examples of this type of embezzlement of licr4minal activity range from theft of pr federal laws, suc'.censee funds to violations of specific as smuggling, counterfeiting, or evading payment of income tax.

In such cases, we make the infora-ation available to the Federal, State, or local law enforca-j=

ment agency having jurisdiction over the matter.

neither the authority nor the desire to investigate such NRC has l

matters except to the extent that they may bear upon NRC statutory, responsibilities.

In the second category are those instances of potential criminality that are clearly related to matters within the l

jurisdiction of the NRC.

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The vast majority of these involve potential violations of the Atomic Energy Act or the General Fraud Against the Government Statutes (such 18 USC 1001 or 18 USC 371).

Some examples of these are willful violations of NRC' regulations made criminal by statute, records falsification

(

j investigator, unlicensed posses,sion of nuclear material attempts to deceive the NRC in order to obtain a license,.

or It is important to note that the vast majority of investi-sations conducted by IE involve, at least at the outset of the investigation, the possibility of criminality where the initial information indicated eith IE is falsification of records relied upon by the NRC or the knowing and willful violation of NRC regulations.

In each of these examples the elements of potential criminality and NRC's regu,latory interests are inextricab intertwined. No decisions can be made health and safety actions or criminal prosecutien until reer m e ofthe-there is an adequate amount of information available on i

which to base suen a decision.

't is av bet.ief that the -

approoriste way to scouire this :,nformation is to initiate et continue an investigation concernine the matter at issue. By following Ents course et action 11, would be able

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to ensure that it promptly possesses information of suf-involving the health and safety of the public.fic to pursue criminal prosecution. time, such an approac At the saae',

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be noted that most instances of potential criminalityIn th encountered,by II are not of the " smoking gun" type.

The

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existing RC-Department of ' Justice agreement coverin i

i criminal referrals provides guidelines for makin, meh 5.

referrals and for the conduct of necessary health and safety investigations and the taking of necessary enforc ment actions, even after such referrals.

DI might be warranted, such as theft of Material (SNM) or sabotage, IE investigators could eith assist the H I or conduct a parallel investigation in coordination with the D I as was done in the r Valley investigation and three other cases in the past year.

Provisions for such actions are currently contained in the BC/D0J agreement.

,I Whether or not criminality is involved, IE investi cessful R C enforcement actions.need to collect suff identify and collect copies of pertinent recordsTo this end, they identify and interview persons who can provide su,bsta and information.

statementa must be obtained.When varranted by the nature of statements, or admissions It should be noted that I

investigators could be use, dor other evidence obtained by IE civil enforcement purposes. for prosecutive as well as Thus

, investigation or prosecution.would enhance rather than 1

the respective investigative jurisdictions o i

offices.

by the Commission.Thus I feel that this matter needs to be cla i

o support the II position:I believe that the following points (1)

The appropriate NRC Manual Chapters and Regulations presently give IE rather than CIA broad authority to conduct external investigations.

authority is not further conditioned by whether the This external matter also involves potential criminality, t

(2)

A thorough II investigation could provide the basis i

i for HC he'alth and safety as well as referral deci-sions.

t (3) belong under the cognizance of an EDO t

(4)

IE has the capability to conduct such investigations i

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_.J (5) The current situation is having an adverse impact on the inspection and enforcement program and is causing 8-confusion among licensees.

(6) It is reasonable for II to present the issues of a ca e F

directly to DOJ rather than through an intermediary.

I Such direct communication would facilitate mutual under-standing and promote the ultimate objective of advancing

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the safety of nuclear activities.

(7) The July 9, 1981 GA0 report on 01A notes the need for CIA to concentrate on its legitimate internal audit role.

Recommendation:

I recommend that the Commission clarify the Delegations of Antherity in MC 0113 and 0127, designating II as the NRC agent for all investigations external to the agency and CIA as the NRC agent for all internal investigations.

Further, both offices should have coordination and referral responsibilities with DOJ for matters falling within their respective jurisdictions.

Coordination:

The Offices of NRR, NHSS, RES, ADM and OELD concur in this recommendation. We have = vided a cerv of th*= w a-

  • a OIA for their infomation'. OIA has inciented its d**f-e ~

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In withhnid written en ant until such time at thie emner is forwarded to the Commission.

5 Willias J. Dircks Executive Director for Operations consnissioners' comments should be provided directly to the office of the secretary by c.o.b. Monday, cetober 26, 1981.

Comunission staff office comunents, if any, should be submitted to the consnissioners NLT october 19, 1981. with an information copy to the office of the secretary.

If the paper is of such a nature that it requires additional time for analytical review and comment, the comunissioners and the secretariat should be apprised of when comments may be-expected.

Distribution:

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Connaissioners i

Commission Staff offices

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V November 20, 1981 Docket No. 50-358 Mr. Douglas Lowenstein Cox Newspapers 1901 Pennsylvania Avenue, N.W.

IN RESPONSE REFER Suite 501 Washington, DC 20006 TO FOIA-81-376

Dear'Mr. Lowenstein:

This is in partial response to your letter dated September 18, 1981, in which you requested, pursuant to the Freedom of Information Act, copies of (1) the Office of Inspector and Auditor's report entitled " Adequacy of IE Investigation 50-358/80-09 at the William H. Zimer Nuclear Power Station," (2) all written material regarding the report and (3) transcripts of any meetings at which the request was discussed.

The seven documents listed on Appendix A are subject to your request.

I understand that you received the first five documents on Novmeber 17, 1981. The last two documents re enclosed.

We will be in touch with you further regarding any transcripts.

Sincerely, TypeoJ,5.iFe=%

J. M. Felton, Director Division of Rules and Records

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Office of Administration

Enclosures:

As stated DISTRIBUTION DRR Rdg POR ORR Subj LPDR DJDonoghue JLSouder JMaynard ECShomaker htcdtd JCCarr CAReed WMu111 nix 3

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, 1-4 c-Re: FOIA-81-376 Appendix A 1.

Memorandum to Chairman Palladino, et. al., from J. J. Cummings dated August 7,1981 re: " Adequacy of IE Investigation 50-358/

  • 09 at the William H. Zimmer Nuclear Power Station" with attachment.

2.

Pkmorandum'to Chairman Palladino from W. J. Dircks dated September 17,1981 re: " July 30,1981 OIA Report, ' Adequacy of IE Investigation 50-358/80-09 at the William H. Zimmer Nuclear Power Station. '"

3.

Memorandum to Chairman Palladino from W. J. Dircks dated September 17,1981 re: " July 30,1981 OIA Report, 'Special Inquiry Re: Adequacy of IE Investigation 50-358/80-09 at the William H. Zimmer Nuclear Power Station'" with enclosures.

4.

Memorandum to Chairman Palladino from J. J. Cumings dated October 8,1981 re: "0IA Report Dated August 7, 1981, ' Adequacy of IE Investigation 50-358/80-09 at the William H. Zimmer Nuclear Power Station'" without attachments.

5.

Letter to M. K. Udall from N. J. Palladino dated November 16, 1981..

6.

Memorandum to J. G. Keppler from G. A. Phillip, undated, re:

" Comments on OIA Report of Adequacy of IE Investigation Report No. 50-358/80-09 at the William H. Zimmer Nuclear Power Station" with attachment.

7.

Memorandum to J. G. Keppler from J..E. Foster dated September 3, 1981 re: "0IA Report ' Adequacy of ISE Investigation 50-358/80-09 at the William H. Zimmer Nuclear Power Station'" with attachments.

6

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