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Utah Gold and Silver Refiner, Top Managers Charged with Conspiracy to Violate Environmental Laws

WASHINGTON, D.C. – A 29-count federal indictment was returned in Salt Lake City, Utah, charging Johnson Matthey, Inc. and two managers with committing conspiracy, concealment by trick, scheme and device, and Clean Water Act (CWA) violations, the Justice Department and Environmental Protection Agency (EPA) announced today. Johnson Matthey, Inc.—a gold and silver refining company; John David McKelvie, current director of Gold and Silver Operations for North America and Europe and former general manager of the Salt Lake City facility; and Paul Card Greaves, former plant manager, were charged as defendants in the indictment.

“The indictment in this case alleges that the defendants violated the laws that protect our environment and conspired to conceal the high level of pollutants they discharged by cheating on required tests and submitting false information regarding the amount of selenium they discharged,” said Sue Ellen Wooldridge, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “This investigation and indictment underscore the Department’s continuing commitment to prosecuting individuals and companies who knowingly pollute our Nation’s waters, and try to hide their illegal conduct from regulators.”

“The defendants are charged with not only illegally discharging contaminated waste water, but also engaging in a concerted effort to cover it up,” said Granta Y. Nakayama, EPA’s Assistant Administrator for Enforcement and Compliance Assurance. “This indictment demonstrates that EPA considers the behavior that is alleged to be a very serious violation of our Nation’s environmental laws, and that both companies and their senior managers will be held accountable.”

“The defendants’ excessive release of selenium into sewers and attempts to conceal their conduct shows a blatant disregard for the law,” said Acting U.S. Attorney Steven Sorenson for the District of Utah. “This indictment is evidence of our commitment to ensuring the health and safety of the people of Utah.”

Johnson Matthey, Inc.—based in Wayne, Pennsylvania—owns facilities throughout the United States in addition to the silver and gold refinery in Salt Lake City, where it refines gold and silver from a semi-refined product called dore.

As part of the refining process at Johnson Matthey, Inc.’s Salt Lake City facility, impurities such as selenium are separated from the gold and silver being refined, and accumulate in the wastewater. Selenium is an element which is known to accumulate in living organisms, causing damage to kidney and liver tissue and to nervous and circulatory systems in humans. It is also linked to deformation and various other reproductive problems in waterfowl.

Johnson Matthey, Inc. held a permit from the Central Valley Water Reclamation Facility (Central Valley) which required the company to limit the amount of selenium it discharged into sewers to 3.47 parts per million during the time period covered by the indictment. The indictment alleges that the company exceeded its monthly limit on selenium discharges during at least 12 separate months between January 2000 and May 2002.

Johnson Matthey, Inc. and the individual defendants were charged with conspiring to conceal the Salt Lake City facility’s discharges of selenium-contaminated water in excess of permit limits by the following means:

-By shutting off wastewater discharging to the sampling point when personnel from Central Valley came on site to sample the wastewater to conceal high levels of selenium discharged from the facility.

-By “cherry-picking” samples of wastewater with low selenium content to submit to laboratories for testing, and then submitting only those testing results to Central Valley, thereby avoiding monetary penalties for exceeding permit limits. Johnson Matthey, Inc.’s permit required that samples taken be representative of the volume and nature of monitored discharges.

-By diluting the wastewater with fresh water from a hose in order to misrepresent the concentration of selenium discharged during normal operations. Johnson Matthey, Inc.’s permit prohibited use of dilution water to achieve compliance with the standards in its permit.

The indictment charges the company and both individual defendants with conspiracy. Johnson Matthey and Greaves are charged with twelve counts, and McKelvie is charged with 11 counts of discharging pollutants in excess of permit limits. In addition, McKelvie was charged with seven counts of concealing Johnson Matthey, Inc. high selenium levels by performing selective sampling. Johnson Matthey, Inc. and Greaves were both charged with ten counts of concealment. Johnson Matthey, Inc. and Greaves were also charged with three counts of rendering inaccurate a monitoring method by shutting off the wastewater flow during monitoring, and violating the permit by diluting wastewater samples. Each of those crimes carries a maximum penalty of five years of prison, and a $250,000 fine for individual defendants, and $500,000 for corporate defendants.

Charges in an indictment are merely accusations. Each of the defendants is presumed innocent unless and until proven guilty in federal court.

The case is being prosecuted by Andrea Steward and Richard Poole, Trial Attorneys in the Environmental Crimes Section of the Department of Justice in Washington.

Acting U.S. Attorney Stephen J. Sorenson commended Special Agent Ted Owens of the EPA, under the direction of Lori A. Hanson, Special Agent in Charge of the EPA’s Criminal Investigation Division for Region 8, for investigating the case.