POGO to NRC: "Conflict of Interest" explained

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October 4, 2004

The Nuclear Regulatory Commission (NRC) sent POGO a letter last Friday responding to our criticism of Wackenhut as the choice to test security at nuclear power plants. Wackenhut provides security at about half the nuclear power sites in the nation--hence a conflict of interest. However NRC claims that this apparent conflict does not matter. Their explanation is that the function of oversight over the tests lies with NRC, not with Wackenhut. Both the Commission and the nuclear power industry, represented by the Nuclear Energy Institute (which chose Wackenhut and gave NRC talking points which they seem to parrot in the above letter), still don�t seem to get what we, and others, are talking about when we say �conflict of interest.� It�s a legal term of art. "More generally, it can be defined as any situation in which an individual is able to exploit their professional or official capacity in some way," (from Wikipedia). In court cases, both sides must have the fullest confidence in a judge�s impartiality--if there�s a real or seeming conflict, the judge traditionally recuses him or herself, so the outcome of the case isn�t questioned. What we have in the force-on-force tests is something very similar. In this case, the public, whom the NRC is charged with protecting from nuclear plant attacks, must have full confidence in the capabilities of plant guards. And the public sees a conflict of interest in having Wackenhut test Wackenhut. The NRC admits as much, according to their letter:

"The NRC recognizes that some may perceive a conflict of interest regarding the industry's selection of a CAF [composite adversary force--the mock attacking force] management organization that provides protective services to a large portion of the operating power reactors."

Do we have faith that the NRC will aggressively monitor these evaluations? Yes. But, as our senior investigator Peter Stockton, a former Energy Department official, will tell you, cheating on these tests is endemic and very easy to do even with "oversight" by a government agency. Cheating may not be immediately obvious to those overseeing tests. For example, how do NRC officials know if an attacking force let defending guards know which direction they're coming from? Anyhow, Wackenhut's record should have barred it from winning the mock attacker contract. Why? Because Wackenhut has cheated, at the Energy Department�s Oak Ridge facility--as recently as last year. View POGO's Nuclear Power Security Archives for background information.

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Founded in 1981, the Project On Government Oversight is a nonpartisan independent watchdog that champions good government reforms. POGO’s investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.