ML20137K240

Statement of J Greenspun Before Senate Committee on Governmental Affairs Re Three Mile Island Criminal Case

ML20137K240
Person / Time
Site:	Three Mile Island
Issue date:	04/09/1987
From:	NRC COMMISSION (OCM)
To:
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NUDOCS 9704040275
Download: ML20137K240 (12)

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STATEMENT OF JULIAN GREENSPUN,.ESQ. y l

BEFORE THE.SENATElCOMMITTEE!ON'GOVERNMENTALLAFFAIRS APRIL 9, 1987 l

My name is Julian Greenspun. Although I am now

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in private practice, for the past fifteen years I have .

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held a varietyaq,f.. federal prosecutor positions in the

. ta, U.S. Department of Justice. From 1979 through 1986, 4

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I served as the Deputy:Chi3 f of Litigation in the General Litigation section of the Criminal Division. In this

• position I supervised thirty attorneys who prosecuted' i

- criminal violations of regulations promulgated by such s

agencies as the Nuclear Regulatory Commission (NRC), .

Mine Safety Health Administration (MSHA), Occupational

, Safety and liealth Administration (OSHA), and many others.

i I spent a significant portion of this period handling a supervising potential criminal cases related to the i commercial nuclear industry, including certain aspects of the Three Mile Island criminal case. ,

Based on my extensive experience with the URC, I can unequivocally state that i know of no other regulatory

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or investigative agency, where senior agency officials  !

have taken as many bizarre and seemingly deliberate actions b.

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intended to hamper the investigation and prosecution l of individuals and companies in the industry the agency regulates.

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-I would like to.further explain this statement by giving the Committee two observations : have made about NRC.. First, the NRC'is in too many ways a captive of ,

' the industry it. regulates. As a result, the agency-has -.

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- discouraged anyone insid'e the agency from finding wrongdoing )

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-on the part of industry representatives. I also-believe j

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there has'been continuous improper pressure on the Office ,

l L of Investigations (OI) by both industry and agency officials.

Second, the NRC has a history of failed leadership in the Office that handles internal investigations and audits.  !

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' Tle Office of Inspector _and Auditor (0:A) acts as if I

j*, is part of the management " team" rather than an independent

" watchdog" for the agency. On more than one occasion, -

r OIA has avoided identifying and reconrending corrective

- action for serious wrongdoing and misranagement by senior j i

a3ency of ficials, while focusing its 1::ention on less  !

important issues.

In my view, S.908, the legislati:.- re.cently introduced to amend the Inspector General Act of ~.978 is absolutely necessary to combat these problems.  !..e NRC would also l

9 benefit from additional Congressional versight of its  :

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programs and-activities. l To assist the Committee, I am prepared to discuss I

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- several specific cases which I bellete demonstrate the o

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NRC's unseemly protection of the industry from necessary j investigations of deliberate wrongdoing. Unfortunately, I cannot. reveal all of the details of these. cases because ,

some of the information is protected by grand jury secrecy . ..

restrictions, and because I have not been able to obtain copies of essential documents I left behind in my Department files to honor these restrictions. '

At the outset I can say that on more than one occasion when wrongdoing was under investigation by the Department,  ;

senior NRC officials, and perhaps even some Commissioners l

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had ex-parte meetings or discussions concerning the subject matter of the investigation with those under investigation.

On at least one occasion, I personally requested that l a senior NRC official not meet with the licensee under investigation. - Despite my importuning, shortly thereafter the official engaged in a lengthy discussion with the target of the investigation. His action unnecessarily derailed criminal prosecution, a fact which I believe was known to those conducting the meetings.

One example of the NRC's obfuscation of a major criminal violation occurred at the Three Mile Island plant. .Furthermore, I believe this violation may have been a contributing factor to the eventual melt-down at that plant. NRC regulations required that if a reactor J

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I was losing over one gallon of water per minute, the source j

- of'which.was unknown, the s'ource of the problem must l l

be found or the reactor shut down. The utility's leak ,

l rate tests for the 6 month period prior to the melt-down., 1 l

In March 1979, indicated'that the reactor was continually losing more than one gallon of water.per minute. However, the operators added water or hydrogen to the reactor, )

and falsified the computer data to create acceptable leak rates on paper. In addition, the results of " bad"  ;

tests were destroyed. The NRC inspector, who also took i

part in NRC's post melt-down investigation, was aware )

i of these unlawful actions at the time the, cccurred but  !

failed to report them as violations. Needless to say, the plant was not shut down until the disastrous melt-down occurred.

After the melt-down, one honest TMI employee spoke at length to NRC employees on at least two occasions about the unlawful falsification and disposal of the ,

leak rate documents. This information was not passed on to the Justice Department.. In fact, the NRC's initial investigation of TMI failed to even mention this information.

See NUREG-0600, " Investigation Into the March 28, 1979 d

Three Mile Island Accident", By Office of Inspection and Enforcement.) Only when this " whistle-blowing" employee i

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was scheduled to appear on televisior. did the' NRC report- '

these allegations to'the Justice Department. Subsequently, the allegations were verified by the independent analysis i of experts'and the testimony of an NRC inspector at the site.

A Despite this, certain senior NRC officials continued to insist that the utility's conduct at TMI was acceptable.

They adopted the utility's position that (1) nothing '

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. prohibited the addition of water to the reactor, (2) there was nothing wrong with the destruction of " bad" -

leak rate tests, and (3) it was difficult to tell a " good"

- test from a " bad" test. It is my belief that these officials actively misled and even lied to the Justice Department in the TMI case. Perhaps most revealing, in a meeting with myself and other prosecutors, Mr. Stello, now Execut'ive  :

Director of the NRC, said that an investigation at TMI would be bad for the operators morale, and: "Nobody is 4 going to tell me how to treat my licensees." It is that attitude which must be dispensed with through changes ,

such as this legislation.

The end result of the TMI matter, of course, was the criminal conviction of the utility for violating i NRC regulations. .See United States of America v. Metropolitan '

Edison Company, CR. No. 83-00188. To demonstrate to f

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~ the Committee the depth of emotion felt by other Justice Department officials I will refer to the statement of U.S. Attorney David P. Queen (now an Assistant Secretary of the Treasury): .

"This not. ion that the NRC investigation -- l whatever on.eartn that is -- is a "far superior vehicle to these_ proceedings today" is utter poppycock. ,

I had not intended to address this issue, but I cannot stand silent and allow the charade that has -

been carried on by the NRC to be treated as anything but that.

We are the only institution since this accident  ;

occurred that has made the slighest damn effort to see this thing through to a conclusion. The NRC has not conducted any meaningful investigation; to this day has used as a pretext the fact that the Grand Jury was conducting an investigation as a vehicle to avoid addressing its responsibilities.

As recently as six weeks ago, the NRC voted three to two to ignore what we are doing here today.

When the United States Department of Justice brought this indictment, when I got sworn into office, this investigation was virtually dormant and had been for some time.

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. %p I didn't see the NRC hustling to clean up the -

loose ends and to make'it known to the public just ,

what went on in 1978 or 1979. We...made a Herculean '

effort to get to the bottom of the facts, something _

'that was not done by the Nuclear Regulatory Commissi'on.

As recently as six weeks ago, as I was about 4

to say,-they voted basically to proceed with a Unit-1 >

license restart application irrespective of the  :

outcome of these criminal proceedings.

Now I realize this is of secondary significance to whether the Court ought to take a plea, but Mr.

Curran (TMI's lawyer) seems to raise the issue that we are not to worry if there are any loose ends here today because the NRC will take care of it.

It is utterl; delusional.

The NRC doesn't care what is in the indictment; they have said so. They don't care what the outcome of this case is: they have said so. They are going to proceed and do whatever they want to do, and f

.i that is fine because I have no control over the NRC, nor does the Attorney General or anyone else in the Department of Justice. But the statement of the facts.as read by me a short time ago are  !

precisely the correct statement of what took place, f

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c a ll The TMI case, among others, demonstrated the real

- need for an independent Office of Investigation at the NRC, and'the lengths to.which some NRC: leaders will go.

to' protect the industry." '

From my perspective at the Department, OI functioned

- fairly effectively, since-it-has sent the Department' several dozen criminal referrals. Prior to OI, the Department received very few referrals from the NRC (see DOJ letter, Stephen J. Trott, Assistant Atcorney General to Honorable Nunzio Palladino, NRC Chairman, March 18, 1985). Despite OI's success, I detected continued pressure on OI to conform with the generally " hands-off" attitude if not

policy of the NRC. These preeaures have led to continuous attempts to control OI. One of the most serious threats 4

is the possibility that OI would be moved under the control j of the Executive Director for Operatic.s, which is no le'ss than putting the fox in the chicken coop. Such an attempt was beaten back in 1985, with the support i

. of the Congress and the Department of Justice. I believe Mr. Trott's letter is very important because it states:

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" Prior to and since the creation of OI, there has been'some opposition as well as resistance within the NRC to the detection and disclosure of deliberate wrongdoing by NRC licensees... Senior personnel within

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i the NRC who'could affect or influence OI's ability i

to detect and report violations if it were realigned ,

Lmay have contributed to.this problem."

n The legislation proposed by Chairman Glenn would statutorily end the possibility of moving OI. I believe  ;

this is a vital step to insure that OI will remain independent, and that wrongdoing will be detected.

i The final example I would like to share with the Committee does not concern a particular criminal case .

2-it is'the proposed Advisory Committee on the Rights of Licensees, which the NRC tried to establish in 1983.

Those behind the establishment of an Advisory Committee i

sought to notify companies in advance that investigations were being undertaken, and allow utility lawyers to attend all meetings between NRC investigators and company personnel. ,

1 L These and other proposed restrictions would have gone well beyond what the Constitution and federal law require in the way of due process for targets or subjections 1 of investigations, who would, no doubt profit handsomely - I l

by insinuating themselves into interviews of employees. )

This (effort,.under the guise of an Advisory Committee),

would have carried the special relationship between the NRC.and its licensees to preposterous lengths. It was

-merely a front to protect the utility companies from

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> disclosure of wrongdoing. DOJ and Congressional intervention thwarted this ruse, and similarly kept the OI from being

, placed'under the NRC senior staff, and, helped persuade ,

i the Commission not to adopt a pro-licensee definition of material false statements, which was another remarkable episode.

One Commissioner summarized the position of those in the NRC who do not favor prosecutions when he told one U.S. Attorney that utilities should not be liable for false statements unless they are made under oath in the course of giving testimony. Of course, almost none of the NRC's contacts with utilities in the course of construction and operation of a nuclear plant are conducted under oath, so prosecution of false statement violations would disappear. A high official of the NRC stated it another way: "I don't want to know about false statements. Is the hardware okay" These attitudes are antithetical to restoring public confidence in the NRC's regulation of commercial nuclear power. While the Committee cannot legislate attitudes, it has proposed the needed changes in the way OI would continue to report ,

internally, and how it will refer cases to the Department.  ;

OIA's Inadeouacies The last issue I would like to discuss concerns

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the inadequacy.of the NRC's Office of Inspector and Auditor, the putative inspector general's office. The leadership of this office has been a disaster. One Director of .

l that office was effectively dismissed only after an embar.rassing.-

. court decision cast doubt upon his integrity. The current head of the office has been the subject of a criminal referral to the Justice Department.. The Department's

. correspondence in that case casts doubt upon her integrity  ;

a and judgment. (See,: Letter from J. Greenspun to S. Connelly,  ;

4 ' February 7, 1986; Letter from L. Lippe to H. Plaine, March 21, 1986; and Letter from L. Lippe to L. Zech, )

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Jr., October 1, 1986.)

OIA has historically ignored prongdoing by NRC staff which benefitted operators of nuclear plants. This indicates to me that they are not investigating matters of importance, or at a minimum, are not conducting these investigations ,

1 in a sufficiently professional manner.  !

I am convinced that a statutory I.G. who has the independence to look will find real wrongdoing at NRC, as.other I. Gs. have found at their agencies. I believe there is a need for a statutory inspector general at the NRC which would aggressively audit and investigate

all of the NRC's programs and activities. Fundamentally, such legislation would ensure that all senior agency

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-officials who engage in inappropriate conduct or mismanagement-are within the jurisdiction of such an office. I also

.believe.the legislation addresses the problem of OI's independence in a vital and necessary. manner.

i Thank'you for providing me with this opportunity-

'to/ testify. I believe the continued existence and absolutely necessary expansion of nuclear power is too.important ,

to the future of this country to allow its regulation in a haphazard fashion. As with the Banking and Securities Industries, however, effective, vigorous and independent enforcement of the law is necessary to minimize the possibility of a disaster as well promote public. confidence in the system. We have no right to expect either with purported watchdogs who are supposed to work for the public, but in reality are "in bed" with those whom they are charged with regulating.  ;

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