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Nuke Manager Faked Safety for Bonuses

Monday, November 19, 2012

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After his company collected over $2.5 million in safety bonuses, a former safety manager for the Shaw Group now faces up to $8 million in fines and 10 years in prison for generating false injury rates at three nuclear facilities.

After a 12-day trial in U.S. District Court, a federal jury in Chattanooga, TN, convicted 55-year-old Walter Cardin, of Metairie, LA, on eight counts of major fraud for falsifying safety records in order to collect bonuses.

Cardin was the safety manager for the Shaw Group's subsidiary, Stone & Webster Contruction, which had contracted with the Tennessee Valley Authority (TVA) to provide maintenance and modifications at three nuclear facilities and construction for a reactor restart.

Photos: TVA

Over 80 injuries were not properly recorded at three nuclear sites: Brown's Ferry (left), Watts Bar (right), and Sequoyah (below). The injuries included broken bones, torn ligaments, and hernias.

The bonuses were paid for meeting certain performance goals, including one tied to worker safety, which was determined by workplace injury rates as well as the total number of injuries at each of the three facilities.

Cardin now faces up to 10 years in prison and a fine of up to $1 million for each offense. Sentencing is set for Feb. 21, 2013.

More than 80 Injuries

Authorities said Cardin provided false and misleading information about injuries at the TVA's Brown's Ferry Nuclear Site (Athens, AL); Sequoyah Nuclear Site (Soddy Daisy, TN); and Watts Bar Nuclear Site (Spring City, TN).

The jury heard evidence of more than 80 injuries—broken bones; torn ligaments; hernias; lacerations; and shoulder, back, and knee injuries—that Cardin had not properly recorded. When workers' injuries jeopardized the bonuses, Cardin fraudulently misclassified them as nonrecordable, non-lost-time, and non-work-related incidents.

He was convicted for providing the false numbers at the three plants in 2004 and 2005, and at the Brown's Ferry and Sequoyah plants in 2006.

As part of a civil agreement filed in 2009, the U.S. Department of Justice announced that Stone & Webster agreed to pay the federal government $6.2 million to end the related contract fraud investigation against the company. The subsidiary also agreed to enter a two-year Corporate Integrity and Monitoring Agreement with the TVA Office of Inspector General.

Cardin helped Shaw Group earn $2.5M in bonuses from the false reports.

Misconduct Report, Painter Whistleblower

The Federal Contractor Misconduct Database lists four instances of misconduct for the Shaw Group since 1995, including the contract fraud at the TVA nuclear plants.

In 2009, the U.S. Department of Labor Administrative Review Board ruled that Stone & Webster Construction broke federal whistleblower protection laws when they fired a painter foreman at TVA's Brown's Ferry Nuclear Plant in 2004. The foreman was fired after he raised concerns about what he thought to be serious problems with the protective coatings being applied to the plant's cooling systems.

In 2010, the U.S. Nuclear Regulatory Commission ordered Shaw Group to institute improvements in its whistleblower protection and workplace safety policies and practices throughout its nuclear operations.

In July, Chicago Bridge & Iron (CB&I) announced a $3 billion cash-and-stock deal to buy the Shaw Group. The deal is expected to close in early 2013.

   

Tagged categories: Accidents; Enforcement; Health and safety; Nuclear Power Plants; Painting Contractor; ShawCor

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