Engineers, White-Collar Crime
& Whistleblowing
Douglas Oliver, PhD, PE & Esq.
AAAS Fellow – NSF-EHR/DRL
(The opinions expressed are the author’s alone.)
2008 Josephson Institute Survey of
30,000 US High School Students
“A person has to lie or cheat sometimes
in order to succeed.”
Honors
Students
Agree
Disagree
Female
33%
67%
Male
48%
52%
Female
31%
69%
Male
46%
54%
2008 Josephson Institute Survey of
30,000 US High School Students
“In the real world, successful people do what they
have to do to win, even if others consider it cheating.”
Honors
Students
Agree
Disagree
Female
54%
46%
Male
65%
35%
Female
53%
47%
Male
63%
37%
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What is the Perception of the Honesty
of Engineers?
Gallup (2006): Perception of Ethical Standards
(positive minus negative)
1
0
-1
Typical White-Collar Crimes
Photo: Independent
• back-dating stock options,
• bribes and kick-backs,
• embezzlement,
• insider trading,
• environmental crimes, and
• obstruction of justice.
Charles Ponzi
Common Element: Fraud
Case Study: Engineers & White Collar Crime
Andrew Siemaszko – Systems Engineer at DavisBesse Nuclear Power Plant.
Major Environmental, Safety, & Mgmt. Problems at First
Energy:
A) 2003 Blackout – attributed to First Energy
B) In 2005, First Energy settled major lawsuit with EPA & DOJ.
C) Davis-Besse had 6 of the 34 significant
“accident sequence precursor”
incidents in the US.
• Siemaszko was hired at Davis-Besse in 1999. Responsible
for the reactor head.
• Refueling outage scheduled for early 2000.
• Boric acid buildup on reactor head had never been cleaned.
• 1998 photo clearly shows boric acid on the head.
2000 Refueling
• Siemaszko pushes for permission to clean the reactor
head during the 2000 refueling outage.
• Siemaszko’s team is given only 1 day to clean the head.
They do not finish in that time.
• The cleaning equipment is removed by management.
• Davis-Besse’s management congratulates Siemaszko’s
team for cleaning the head for the first time ever.
1998
photo
2000
photo
2001: NRC Worried About Reactor Head Problems &
Sought Assurances from Davis-Besse
• Davis-Besse management sought to wait until
2002 to shut down for inspection.
• Siemaszko and his documentations were used to
support management’s effort to convince the
NRC that Davis-Besse’s reactor head was safe.
• NRC approved a delay in shutting down DavisBesse until 2002.
2002 Refueling Discovery
• The boric acid had corroded a football-sized hole in the
reactor head.
• Only a thin sheet of stainless steel liner remained.
• Management told Siemaszko to quit or be fired. He
chose to be fired, then sued as a whistle-blower.
Management Defended, Claiming:
• “Siemaszko failed to follow the Boric Acid Corrosion
Control procedure and inaccurately recorded the results
of his 2000 … inspection and cleaning activities”,
• “Siemaszko was a key technical contributor to the
Company’s response(s) to [the] NRC … which
contained inaccurate and/or incomplete statements.”
Result: Siemaszko’s case was dismissed by OSHA.
Epilogue
• In 2005 Siemaszko was banned from working in
the nuclear industry for 5 years.
• In 2008 Siemaszko was convicted for
“concealing information from and making false
statements to” the NRC.
• The Union of Concerned Scientists views
Siemaszko as a “scapegoat”.
• The Federal Judge called this a “close case”.
Cartoon in Local Newspaper
Federal Prosecution of Corporations
and Reverse Whistle-Blowing
• Innocent people may lose their jobs when a
corporation is prosecuted. Hence, there is a
reluctance to criminally prosecute corporations.
(Neither FirstEnergy, nor Boeing were prosecuted.)
• Federal prosecutors tend to bargain with
corporations in exchange for avoiding a criminal
indictment of the corporation.
Reverse Whistle-blowing
• Employees are encouraged to be “team
players”.
• There is an expectation that if you cover for the
“team” then the team will support you.
Result: Some corporations tacitly encourage illegal
employee behavior. In spite of this, employees
should expect that, once the illegal activity
becomes known to authorities, a corporation will
likely testify against partially culpable employees.
Conclusions
• Future engineers have serious ethical
challenges.
•The fraud triangle is a useful tool for
science & engineering ethics education.
•Employees who are pressured to
commit a crime on behalf of an employer,
should expect that the employer will
provide evidence against them should
the crime be exposed.