United States Nuclear Regulatory Commission - Protecting People and the Environment

Information Notice No. 97-75: Enforcement Sanctions Issued as a Result of Deliberate Violations of NRC Requirements

                                     UNITED STATES
                             NUCLEAR REGULATORY COMMISSION
                   OFFICE OF NUCLEAR MATERIAL SAFETY AND SAFEGUARDS
                         OFFICE OF NUCLEAR REACTOR REGULATION
                                WASHINGTON, D.C.  20555

                                  September 24, 1997


NRC INFORMATION NOTICE 97-75:  ENFORCEMENT SANCTIONS ISSUED AS A RESULT OF
                               DELIBERATE VIOLATIONS OF NRC REQUIREMENTS


Addressees

All U.S. Nuclear Regulatory Commission licensees.

Purpose

The U.S. Nuclear Regulatory Commission (NRC) is issuing this information
notice to remind licensees and their employees of the sanctions that could
result from deliberately violating regulatory requirements.  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 NRC requirements;
therefore, no written response is required. 

Description of Circumstances

Power Inspection, Inc., was a nondestructive testing firm, licensed by NRC to
perform industrial radiography.  The licensee acted as a vendor supplying
services to nuclear power plants, including the performance of nondestructive
testing services, such as eddy current testing of steam generators.  This
activity required the testing staff to be certified in each of the
nondestructive testing techniques being used.

During a 1993 inspection at the licensee's Wexford, Pennsylvania, facility,
and a subsequent investigation by the NRC Office of Investigations, it was
determined that:  (1) false eddy current testing qualification certifications
were deliberately generated by the licensee for employees who performed eddy
current examinations at nuclear power plants; (2) false eddy current
qualification examination results were deliberately generated for employees;
(3) false letters regarding the trustworthiness and reliability of Power
Inspection employees were provided to NRC reactor licensees when Power
Inspection knew that its employees had tested positive for illegal drug use
before working at nuclear power plants; and (4) source utilization logs were
falsely created by licensee employees to satisfy questions regarding the lack
of such utilization logs during a previous NRC inspection.  These actions were
condoned or directed by the President of the company.  



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The licensee and its former President, who has since left the employment of
the company, have a past history of engaging in deliberate misconduct.  In
1988, the former President  and the licensee entered pleas of guilty to false
statements and were charged by the  U. S. Department of Justice with
falsifying eddy current equipment calibration certifications for work
performed at a nuclear power plant.  The former President was sentenced to a
3-year period of probation and fined $3000.

Discussion 

Licensees are responsible for ensuring the safe performance of licensed
activities in accordance with NRC regulations and the requirements of their
licenses, and for providing complete and accurate information to NRC in all
material respects.  In cases that involve vendor activities regarding nuclear
power plants, full compliance with certification requirements for
nondestructive testing staff is critical because nuclear power plants rely on
the results of vendor activities for certification of safety-related systems. 


NRC expects licensee employees to be completely candid and cooperative with
NRC personnel during the licensing and inspection process.  The regulatory
process functions on the premise that licensees will, at all times, provide
complete and accurate information to NRC in a timely manner.  Violations of
NRC requirements caused by deliberate acts or efforts to impede the regulatory
process may subject wrongdoers to criminal sanctions by the U.S. Department of
Justice and civil sanctions by NRC.  In the case identified as a result of the
1993 inspection, the U.S. Department of Justice declined criminal prosecution
in 1996.  Subsequently, NRC issued immediately effective orders to the former
President and the former Vice President/Radiation Safety Officer prohibiting
them from any involvement in NRC-licensed activities for periods of 10 years
and 5 years, respectively.  Notices of Violation were issued to two other
licensee employees.

While the particular case described above involves deliberate misconduct by
radiography licensee employees, the principles involved apply to any NRC
licensee or any employee of a licensee; and any contractor (including supplier
or consultant), subcontractor, or any employee of a contractor or
subcontractor, of any licensee.

Related Generic Communications

The following related communications and correspondence are noted:

NRC Information Notice 86-54, "Criminal Prosecution of a Former Radiation
Safety Officer Who Willfully Directed an Unqualified Individual to Perform
Radiography," dated June 27, 1986.

NRC Information Notice 92-22, "Criminal Prosecution and Conviction of
Wrongdoing Committed by a Commercial-grade Valve Supplier," dated
March 24, 1992.
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NRC Information Notice 92-37, "Implementation of the Deliberate Misconduct
Rule," dated May 8, 1992.

NRC Information Notice 93-73, "Criminal Prosecution of Nuclear Suppliers for
Wrongdoing," dated September 15, 1993.

No written response is required by this information notice.  If you have any
questions about this matter, please call the technical contacts listed below
or the appropriate NRC regional office.


  original signed by                           original signed by

Donald A. Cool, Director                Jack W. Roe, Acting Director
Division of Industrial and              Division of Reactor Program Management
  Medical Nuclear Safety                Office of Nuclear Reactor Regulation
Office of Nuclear Material Safety
   and Safeguards

Technical contacts:  Nader Mamish, NMSS
                     301-415-6316
                     E-mail:  nlm@nrc.gov

                     John McGrath, RI
                     (610) 337-5069
                     E-mail:  jrm@nrc.gov

Attachments:
1.  List of Recently Issued NMSS Information Notices
2.  List of Recently Issued NRC Information Notices


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