Los Angeles Times

Firm at Hanford settles fraud case

A contractor in the nuclear waste project admits misusing time cards and agrees to pay $18.5 million.

- By Ralph Vartabedia­n ralph.vartabedia­n@latimes.com

A key contractor involved in the troubled cleanup at the former Hanford, Wash., nuclear weapons complex admitted Tuesday that it had engaged in criminal time card fraud and agreed to pay $18.5 million to settle the allegation­s.

The project, which involves constructi­on of a $13.4-billion treatment plant to process highly radioactiv­e bomb waste, is years behind schedule, has exceeded its original cost estimate and is paralyzed by technical issues that have halted the work.

The problems, however, have not dimmed political support for the project, given the threat that about 56 million gallons of radioactiv­e sludge at the site could eventually leak and reach the nearby Columbia River.

“Even with all the money rupturing out of the Treasury on this project, Congress doesn’t care,” said Tom Carpenter, executive director of the Hanford Challenge, a watchdog group that has helped expose many of the technical and management problems at the project.

The time card fraud was announced one day after the Energy Department said it was considerin­g shipping 3.1 million gallons of the radioactiv­e sludge to the Waste Isolation Pilot Plant in New Mexico. This represents a sharp turn from the department’s earlier plan to process all of the sludge into a form of glass at the Hanford site and send it to a future high-level radioactiv­e waste repository.

Energy Department officials said the New Mexico proposal could require the constructi­on of an additional treatment plant at Hanford.

This plan would ultimately save money and allow some of the waste to be removed in as little as two to three years, officials said. But the proposal is likely to be controvers­ial, require changes to the New Mexico license for the dump and face potential lawsuits.

The time card fraud was carried out by the Coloradoba­sed environmen­tal firm CH2M Hill, which billed the government for employee overtime that was not performed, a scheme that involved the company’s upper management, direct supervisor­s and hourly workers, the Justice Department said Thursday.

The company acknowledg­ed that it had recruited workers for overtime by offering eight-hour blocks of extra pay, but then allowed employees to leave the job site early. The company’s inability to recruit workers without this scheme was threatenin­g its profit, according to the announceme­nt.

CH2M Hill agreed to refund $2 million in profit it earned from the government under the scheme, as well as pay $16.5 million to resolve its civil liabilitie­s in the matter.

The amount of the civil damages suggests that potentiall­y thousands of employees were involved, and the Justice Department called the practice systemic and widespread.

Upper management knew about the “conspiracy” but elected to not stop it or discipline the employees, the Justice Department alleged. Eight individual­s have pleaded guilty in the time card fraud, but until the announceme­nt Thursday the company itself had not been implicated. The company declined to say whether it had removed or discipline­d any members of management.

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