The next time you hear a government employee or government contractor defending the integrity of Holtec International, or awarding the company a juicy federal contract, keep in mind that the employee may have been paid off by Holtec. At least that’s what is alleged in this blockbuster story by the Philadelphia Inquirer.
Kris Singh, CEO of
July 11, 2019 Philadelphia Inquirer
Business as usual?
We are drawing attention to this story, and the scathing report by the Inspector General of the Tennessee Valley Authority because Holtec is the company behind the nuclear waste storage system at the beachfront San Onofre Nuclear Waste Dump. And if past is prologue, perhaps a few decison makers have been bribed.
Holtec funneled $50,000 to federal employee in bid to win contract, inspector general report says
Holtec International, the energy company that in 2014 was awarded $260 million in tax breaks by New Jersey officials to invest in Camden, allegedly funneled tens of thousands of dollars to a manager at a federal agency in an effort to secure a government contract in the early 2000s, according to an inspector general’s report cited in a hearing Tuesday.
As Holtec was seeking the contract with the Tennessee Valley Authority in 2001, the company also treated the manager and his wife to a round-trip flight to Philadelphia and stays at the Rittenhouse Hotel and the Trump Taj Mahal in Atlantic City, and a $2,137.20 dinner party at the famed restaurant Le Bec-Fin, according to the report by the federal agency’s Office of Inspector General.
The manager, John L. Symonds, who worked at an Alabama nuclear plant owned by the TVA, pleaded guilty in 2007 to federal charges related to his failure to disclose $54,000 in income on his financial disclosure forms. The money had been directed to Symonds’ company by Holtec, records show.
No one at Holtec was charged with a crime, and the 2010 inspector general’s report redacts most of the names associated with Holtec officials. But the report makes reference to “statements by Krishna Singh,” the company’s CEO, before describing a secretly recorded conversation between Symonds and a Holtec official.by Andrew Seidman and Catherine Dunn,
Symonds came up with the name for his company, Krohn Enterprises, by using the first two letters of the Holtec official’s first name and the last three letters of his own first name, the report says.
The report was obtained via the Freedom of Information Act by a task force appointed by Gov. Phil Murphy to investigate New Jersey’s tax credit programs. Jim Walden, the lead lawyer for the task force, said Tuesday during a hearing in Trenton that Singh’s possible involvement in directing payments to the TVA employee should have raised red flags at the state Economic Development Authority before it awarded Holtec tax credits to relocate from Marlton to Camden.
Businesses seeking tax incentives in New Jersey are required to say on their application whether they have ever been prohibited from working as a contractor at a state or federal agency. As ProPublica/WNYC reported in May, Singh falsely certified on Holtec’s application that the company had never faced that penalty.
Following the inspector general’s investigation, the TVA in 2010 debarred Holtec for 60 days, and the company agreed to pay a $2 million fine. The company has since resumed contracting for TVA.
Holtec, which did not respond to requests for comment Tuesday, denied paying Symonds, according to the report. Holtec has described the failure to report the debarment as an inadvertent oversight. But Walden, the task force special counsel, said the records disclosed Tuesday suggest “Mr. Singh may have played a role in … or at least at a minimum been aware of” the activity that led to Holtec’s debarment as a contractor with the TVA.
The Economic Development Authority is investigating Holtec’s tax credits.
Tuesday’s hearing marked the first time investigators convened in front of the public since they released a sweeping initial report last month, in which they called out “special interests” as shaping and benefiting from the tax credit legislation, namely the law firm Parker McCay, headed by Philip Norcross, and his brother George E. Norcross III, the Democratic power broker who is executive chairman of the insurance brokerage Conner Strong & Buckelew and sits on the board of Holtec.
Both Parker McCay and Conner Strong, along with several other companies and George Norcross personally, have sued Murphy, claiming the governor created the task force unlawfully. The companies have denied any wrongdoing, and George Norcross said he would be willing to testify in front of a state legislative committee.
A Superior Court judge rejected the companies’ bid last month to halt the task force’s work during the lawsuit. That decision allowed investigators to publish their first report — which identified more than $500 million in tax credit awards that could be terminated — and set the stage for Tuesday’s hearing.
The task force shared the new details about Holtec on a day largely devoted to taking comment from members of the public.
About 40 people spoke over nearly five hours. The testimony was largely split between two camps: Critics of the program, who said it was born of political corruption and benefited “insiders,” and supporters of the credits, including Camden officials and residents, who suggested minor revisions to the program but said the tax credits had helped an impoverished city.
“I don’t know what Holtec may or may not have placed in their application,” said Camden Mayor Frank Moran. But he said it mattered to him that his grandson could study to become an engineer, and have the possibility of getting a good job there one day.
According to the inspector general report on Holtec’s TVA project, a company official had breakfast with Symonds in September 2001 at the Marriott Hotel in Huntsville, Ala. There, the Holtec official told Symonds that the firm could route the $50,000 payment to Symonds by setting up a business for his wife that would offer background check services.
Symonds established Krohn Enterprises in November 2001 as a limited liability company in Delaware, with a post office box in Huntsville. That was the same month that Holtec won the contract to design and construct a storage system for spent nuclear fuel rods at TVA’s Brown’s Ferry Nuclear Plant in Athens, Ala.
Investigators said Holtec funneled the payments through a third company in order to give Krohn $50,000 for background checks. But Krohn never provided those services, according to investigators.
By 2006, federal prosecutors and the TVA’s Office of Inspector General had taken an interest in the payments.
Under the section in the report titled “statements by Krishna Singh,” investigators for the inspector general describe an October 2006 interview with a Holtec official.
The official, whose name is otherwise redacted, told investigators that the subcontractor had been having problems with employee thefts, hence the need for security checks. The official also said “he would not have offered any money to Mr. Symonds or Krohn Enterprises for any reason,” the report says.
The official added that “he was a very ethical person in business dealings.”
During the investigation, Holtec told the inspector general that it “categorically asserts that the company has not provided any funds” to Symonds “in any shape or form, directly or indirectly,” according to the report.
A spokesperson for the TVA Office of Inspector General declined to comment on the redactions made to the report except to say they were made under an exemption to Freedom of Information Act law that provides protection for law enforcement information that if disclosed “could reasonably be expected to constitute an unwarranted invasion of personal privacy.”
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