Last week, the US Department of Justice (DOJ) filed a complaint against a company called CB&I Areva MOX Services and its subcontractor, Wise Services, for allegedly billing the US government for supplies that were never delivered. According to the complaint, a manager at Wise offered kickbacks including football tickets, guns, a YETI cooler, and a television to receive preferential treatment on a US government project to build a nuclear fuel reforming facility.

MOX Services was contracted by the United States National Nuclear Security Administration (NNSA) to build the Mixed Oxides Fuel Fabrication Facility (MFFF), which would have repurposed weapons-grade plutonium as fuel for nuclear reactors in the United States.

After wasting more than $7.6 billion on the MFFF, the US Department of Energy (DOE) canceled work on the South Carolina facility. The department has been quietly moving plutonium out of the area since then.

In the DOJ's February complaint (PDF), feds accuse Wise and MOX Services of submitting invoices with close to $6.3 million in fraudulent charges among them. Wise then gave gifts to MOX Services employees to encourage them to turn a blind eye to the bad invoices. While $6.3 million is a small amount compared to the $7.6 billion that the US government ultimately lost on the project, the NNSA hopes to reclaim lost funds from the two contractors through a jury trial.

The kickbacks

Much of the complaint centers around Phillip Thompson, Wise's Senior Site Representative for the project, who pleaded guilty to conspiracy to commit theft of government funds in 2017. Between 2008 and 2016, Thompson (acting on behalf of Wise) allegedly submitted 484 claims to MOX Services "that were knowingly false and fraudulent, because the claims included costs for non-existent materials," the complaint says.

MOX Services, in turn, apparently turned around and submitted more than 200 receipts to the NNSA for reimbursement, all while knowing that Wise had falsified deliveries. In addition, "Wise added a 3 percent fee to the costs for the non-existent materials," according to the complaint.

According to the complaint, Wise provided invoices from six supply companies, but these invoices included non-existent materials. In the case of two companies, invoices "were hand-written," "did not include shipping fees," and "were located within 50 miles of Wise's home office in Dayton, Ohio," rather than in South Carolina, where the facility was being built. One supplier had an address at the top of the invoice that traced back to a residential address in Ohio, according to the complaint.

In addition, feds say that Thompson pretended to buy millions of dollars of materials for the MFFF, then would "reimburse" himself from the Wise petty cash account and send an invoice to MOX Services. MOX, in turn, requested repayment from the federal government.

All the while, MOX Services employees knew about Thompson's apparent hustle and looked the other way due to the $52,000 in gifts that Thompson and Wise bought for them, according to the complaint. "These kickbacks consisted of things of value such as cash, gift cards, YETI coolers, sunglasses, mobile phones, NASCAR tickets, Masters Golf Tournament tickets, college football tickets, firearms, and hunting supplies," the complaint notes.

Go Crimson Tide

The DOJ alleges that a MOX Services Subcontract Technical Representative was given a barbecue grill, car tires, gift cards, and a hunting rifle. In another case, a MOX Services Field Electrical Superintendent and Construction Manager "specifically detailed the kickback he wanted from Wise," which was, in this case, tickets to University of Alabama football games along with nights at a nearby hotel, according to the complaint. Thompson also allegedly hired the son of a MOX Services Subcontract Administrator "in order to obtain favorable treatment" from the company.

Things seem to have become more tenuous for Wise when, in January 2015, one of the MOX Services employees who had been receiving kickbacks took several days off for the Christmas holiday and allegedly returned to find his signature forged on invoices indicating his approval for repayment by the NNSA. When the employee took the matter up with his superiors, "Mr. Thompson admitted to forging and photocopying" his signature, according to the complaint.

Following several meetings with superiors, "MOX directed that all future material purchases for the Wise Subcontracts must go through MOX procurement department, and Wise was no longer allowed to procure and charge for materials under the Wise Subcontracts."

Last week, the Nuclear Regulatory Commission terminated MOX Services' construction authorization at the South Carolina site, at the contractor's request.