Information Notice No. 83-60: Falsification of Test Results for Protective Coatings

                                                           SSINS No.:  6835 
                                                           IN 83-60        

                               UNITED STATES 
                        NUCLEAR REGULATORY COMMISSION
                    OFFICE OF INSPECTION AND ENFORCEMENT 
                          WASHINGTON, D.C.  20555 
                                     
                             September 22, 1983 

Information Notice No. 83-60:   FALSIFICATION OF TEST RESULTS FOR 
                                   PROTECTIVE COATINGS 

Addressees: 

All holders of a nuclear power reactor operating license (OL) or 
construction permit (CP), and nuclear fuel cycle licensees. 

Purpose: 

This information notice is provided as a notification of a potentially 
significant problem pertaining to the alteration of a test report and 
subsequent use of substandard materials at a nuclear facility. 

Earlier this year, a jury found the Quality Assurance Director of a 
protective coatings company guilty of fraudulent practices. Although the 
fraudulent practices occurred in 1979 and 1980, the criminal trial was not 
concluded until March 25, 1983. Nuclear power reactor licensees who had 
purchased protective coatings from this company during the period of concern
were notified at the time. Presently, the details of this case are being 
publicized to illustrate the risk involved in accepting test reports that 
are not provided directly from an independent testing facility. 

It is expected that addressees of this information notice will review the 
general problem described herein for applicability to their facilities. No 
specific action or response is required. 

Description of Circumstances: 

In early 1979, Con-Chem, Incorporated (CCI) sought a contract to supply a 
protective coating for use at the Hope Creek Generating Station. The 
architectural engineering firm for the Hope Creek project was Bechtel 
Corporation of San Francisco. To qualify for consideration, bidders were 
required to demonstrate that the coatings would withstand accident-level 
radiation exposures. Pursuant to this requirement, CCI submitted concrete 
test blocks coated with their product to Oak Ridge National Laboratory 
(ORNL) for radiation tests. Following receipt of an acceptable test report 
and confirming photographs 




8308300330 
.

                                                         IN 83-60          
                                                         September 22, 1983 
                                                         Page 2 of 2       

of the test blocks, Bechtel awarded the contract to CCI and the protective 
coating was applied to selected areas within containment at the Hope Creek 
Generating Station. 

Later, an FBI investigation determined that the Quality Assurance Director 
for CCI had altered the ORNL test report before-delivering it to Bechtel. 
The report provided to Bechtel by the Quality Assurance Director stated 
"coating intact, no defects" whereas a copy of the report on file at ORNL 
indicated "delamination," "cracking," and "peeling" of the coating following
the radiation exposure tests. Additionally, it was discovered that the 
photographs of the test blocks actually showed untested blocks which had 
been spray painted brown by the Quality Assurance Director to make them 
appear radiation tested. The protective coating used at Hope Creek had to be 
removed and replaced. The investigation did not uncover any illegal or 
fraudulent activity on the part of any other company official. 

On March 25, 1983, a jury found the Quality Assurance Director guilty and he
was later sentenced to three years' confinement and fined $6,000. 

In this case and perhaps others, it appears the problem and associated cost 
and schedule-related impact could have been averted by requiring that the 
test report or a copy thereof be submitted directly from the reputable 
testing facility.  

If you have any questions regarding this matter, please contact the Regional
Administrator of the appropriate NRC Regional Office, or this office. 


                              Edward L. Jordan, Director 
                              Division of Emergency Preparedness 
                                and Engineering Response 
                              Office of Inspection and Enforcement 

Technical Contact:  R. M. Young, IE 
                    49-27275 

Attachment: 
List of Recently Issued IE Information Notices
.