GAO NRC Investigation Nets Radioactive License for Bogus Business

July 18, 2007 // Published as a news service by IHS

Tools for Engineers IHS sells standards collections and regulatory information for the oil & gas, petrochemical and utilities industries. For more information and a price quote, please complete the form below. API Collections ASME BPVC ASTM Collections CyberRegs - Compliance library IHS Standards Expert - Standards DB IEEE Collections NEMA Collections AWS D1.1 Welding Code First Name: Last Name: Email address:

By using the name of a bogus business that existed only on paper, U.S. Government Accountability Office (GAO) investigators were able to obtain a genuine radioactive materials license from the U.S. Nuclear Regulatory Commission (NRC).

Aside from traveling to a non-agreement state to pick up and send mail, GAO investigators did not need to leave their office in Washington, D.C. to obtain the license from the NRC.

Further, other than obtaining radiation safety officer training, investigators gathered all the information they needed for the license from the NRC web site, according to highlights from a testimony before the U.S. Senate Permanent Subcommittee on Investigations, Committee on Homeland Security and Governmental Affairs.

After obtaining a license from the NRC, GAO investigators altered the license so it appeared that the bogus company could purchase an unrestricted quantity of radioactive sealed sources rather than the maximum listed on the approved license.

The GAO then sought to purchase, from two U.S. suppliers, machines containing sealed radioactive material. Letters of intent to purchase, which included the altered NRC license as an attachment, were accepted by the two suppliers, said the GAO.

These suppliers gave the GAO price quotes and commitments to ship the machines containing radioactive materials. The amount of radioactive material the GAO could have acquired from these two suppliers was sufficient to reach the International Atomic Energy Agency (IAEA) definition of category 3, said the GAO.

According to the IAEA, category 3 sources are dangerous if not safely managed or securely protected. Importantly, with patience and the proper financial resources, the GAO could have accumulated substantially more radioactive source material.

The GAO said it also attempted to obtain a license from an agreement state, but withdrew the application after state license examiners indicated they would visit the bogus company office before granting the license. An official with the licensing program told the GAO that conducting a site visit is a standard required procedure before radioactive materials license applications are approved in that state.

As a result of this GAO investigation, the NRC suspended its licensing program until it could determine what corrective actions were necessary to resolve the weaknesses the GAO identified.

On June 12, 2007, the NRC issued supplemental interim guidance with additional screening criteria. These criteria are intended to help a license examiner determine whether a site visit or face-to-face meeting with new license applicants is required.

The GAO recommended that the NRC develop improved screening criteria to evaluate new license applications, conduct periodic reviews of license examiners to ensure the criteria are properly applied and explore options to prevent license counterfeiting.

The NRC regulates domestic medical, industrial and research uses of sealed radioactive sources. Organizations or individuals attempting to purchase a sealed source must apply for a license and gain the approval of either the NRC or an "agreement state." To become an agreement state, a state must demonstrate to the NRC that its regulatory program is compatible with NRC regulations and is effective in protecting public health and safety. The NRC then transfers portions of its authority to the agreement state.

In 2003, the GAO reported that weaknesses in the NRC licensing program allowed terrorists to obtain radioactive materials. The NRC took some steps to respond to the GAO report including issuing guidance to license examiners.

To determine whether NRC actions to address GAO recommendations were sufficient, the subcommittee asked the GAO to test the licensing program using covert investigative methods.

Source: U.S. Government Accountability Office (GAO).