Environmental Crimes Case Bulletin U.S. Environmental Protection Agency Office of Criminal Enforcement, Forensics and Training This bulletin summarizes publicized investigative activity and adjudicated cases conducted by OCEFT Criminal investigation Division special agents, forensic specialists, and legal support staff. To subscribe to this monthly bulletin you may sign up for email alerts on our publications page. Unless otherwise noted, all photos are provided by EPA-CID. September—October 2021 In This Edition: DiAne Gordon—Region 4 Charles L Stinson, Logsdon Valley Oil Inc a.k.a. Hart Petroleum —Region 4 Eric Jay Weckwerth-Pineda, Tanner John Sik—Region 5 James Love—Region 6 WyattTravnichek—Region 7 Stephan Reisinger—Region 8 Signal Peak Energy, LLC—Region 8 Christopher M. Cox—Region 10 4% United States •9*2* |-*jOrk Environmental Protection In I Agency EPA Pub. 310-N-15-007 ------- Regie 4 4 5 6 7 8 8 10 © Defendant Summary Defendants Case Type/Status DiAne Gordon Plea Agreement Charles L. Stinson, Logsdon Valley Oil Inc a.k.a. Hart Petroleum Indictment Eric Jay Weckwerth-Pineda Tanner John Sik Sentencing James Love Plea Agreement Wyatt Travnichek Plea Agreement Stephan Reisinger Sentencing Signal Peak Energy, LLC Information Christopher M. Cox Plea Agreement Page 2 EPA Bulletin: Sept—Oct 2021 ------- Sentencings $1.1M Ordered in Restitution for Men Who Fired Shots at Fuel Pipeline Causing Over 3,900 Gallon Spill into Yellow Medicine River in Minnesota On October 6, 2021, Erik Weckwerth-Pineda and Tanner Sik were each sentenced to one year of probation and ordered to pay $1,138,772.06 in restitution for causing thousands of gallons of oil to spill into the Yellow Medicine River. According to court documents, on April 24, 2019, Eric Jay Weckwerth-Pineda, 25, of Cottonwood, Minnesota, and Tanner John Sik, 21, of Ivanhoe, Minnesota, traveled to the northwest side of Cottonwood Lake in Lyon County to a bridge that spans a dam between Cottonwood Lake and a creek called Judicial Ditch 24, which flows into the Yellow Medicine River. Weckwerth-Pineda and Sik took guns to the bridge to shoot. Sik used a DPMS AR-15 rifle to fire multiple shots at a diesel fuel pipeline that runs perpendicular across Judicial Ditch 24. Weckwerth-Pineda used the scope on his own rifle to spot Sik's shots. Weckwerth-Pineda and Sik admit at least one shot struck and ruptured the pipe. Later that day, Weckwerth-Pineda and Sik returned to the ar- ea and saw that the pipeline was leaking and reported the leak to the authorities. According to court documents, the owner of the pipeline, Magellan Midstream Partners, L.P., claimed that the pipe's rupture caused at least 3,906 gallons of diesel fuel to spill into Judicial Ditch 24 at a cost of approxi- mately $1,122,617.64 to clean up the spill and repair the pipeline. The Environmental Protection Agency also expended $16,154.42 in as- sisting in the clean-up opera- tion. "We hope that the sentencings cause people to think twice before engaging in irresponsi- ble and reckless behavior in the vicinity of an active pipe- line," said Andrea M. Kropf, Special Agent-in-Charge, Mid- western Region, U.S. Depart- ment of Transportation Office of Inspector General. "Working with our federal law enforcement and prose- cutorial partners, we will continue our vigorous efforts to protect the safety and integrity of the pipeline trans- portation system, as well as our nation's natural re- sources and environment." The case was investigated by EPA's Criminal Investiga- tion Division, the Department of Transportation Office of the Inspector General, the U.S. Coast Guard, the Lyon County Sheriff's Office, and the Lyon County Attorney's Office. This case was prosecuted by DOJ. © m Page 3 EPA Bulletin: Sept—Oct 2021 ------- Sentencings Former North Dakota Maintenance Supervisor Sentenced for Obstruction of OSHA Investi- gation Into Death of Cargo Tank Welder On October 14, 2021, the U.S. District Court for North Da- kota sentenced Stephan Reisingerto time served, 18 months of supervised release, and a $100 special assess- y ment. On March 8, Reisinger pleaded guilty to one count of j obstruction of an Occupational Safety and Health Admin- istration (OSHA) proceeding. Reisinger was a maintenance JF . manager at Nabors Completion and Production Services Company (NCPS) in Williston, North Dakota. On October 3, 2014, an NCPS employee was fatally injured in an explo- r ^ sion while welding on an uncleaned tanker trailer that had been used to transport produced water, a liquid byproduct ^ ' generated during the extraction of oil and natural gas. Dur- ing OSHA's investigation into the employee's death, Reisinger falsely stated that "just water" was in the tanks but, in the plea agreement, admitted to knowing the tanker trailers transported produced water, which can contain flammable chemicals. DOT-OIG conducted the investigation with OSHA, EPA's Criminal Investigative Division and the Bureau of Al- cohol, Tobacco, Firearms, and Explosives. © * ® Page 4 EPA Bulletin: Sept—Oct 2021 ------- Plea Agreements Environmental Consulting Firm's Former Chief Executive Officer Pleads Guilty to Submitting Hundreds of False Monitoring Reports The former CEO and co-owner of an environmental consulting firm pleaded guilty on October 26, 2021 to fabricating discharge monitoring reports required under the Clean Water Act and submitting those fraudulent documents to state regulators in Tennessee and Mississippi. According to court documents and information in the public record, DiAne Gordon, 61, of Memphis, was the co-owner and chief executive officer of Environmental Compliance and Testing (ECT). ECT held itself out to the public as a full-service environmental consulting firm and offered, among other things, sampling and testing of stormwater, process water and wastewater. Customers, typically concrete companies, hired ECT to take samples and analyze them in a manner consistent with Clean Water Act permit requirements. Gordon claimed to gather and send the samples to a full -service environmental testing laboratory. The alleged results were memorialized in lab reports and chain of custody forms submitted to two state agencies, Mississippi Department of Environmental Quality (MDEQ) and the Tennessee Department of Environment and Conser- vation (TDEC), to satisfy permit requirements. In reality, Gordon fabri- cated the test results and related reports. She even forged documents from a reputable testing laboratory in furtherance of her crime. Gor- don then billed her clients for the sampling and analysis. Law enforce- ment and regulators quickly determined that Gordon created and sub- mitted, or caused to be submitted, at least 405 false lab reports and chain of custody forms from her compa- ny in Memphis to state regulators since 2017. Pursuant to the terms of her plea agreement, Gordon will pay $201,388.88 in restitution to the victims of her crime. "By fabricating these reports, Gordon betrayed her position of trust and violated her responsibility to provide information critical to evaluating water quality for residents in Tennessee and Mississippi," said Assistant Attorney General Todd Kim of the Justice Department's Environment and Natural Resources Division. "This prosecution shows the value of state and federal partnerships in investigating and prosecuting fraud and up- holding the nation's environmental laws for the good of public health." "The Clean Water Act ensures that water quality is maintained throughout the United States," said Acting U.S. Attorney Joseph C. Murphy Jr. for the Western District of Tennessee. "Correct and accurate test results of discharges into rivers and stream and the honest reporting of those results to regulatory authorities are important parts of the Act's regulatory framework. Without accurate test results and reporting of those re- sults, the Clean Water Act will not work as Congress intended. Because honest reporting of this data is so im- portant to the functioning of the Act, our office will vigorously prosecute individuals who falsely report test results." "The defendant's job was to help her clients remain in compliance with the Clean Water Act but instead she Gordon fabricated the test results and related reports. She even forged documents from a reputable testing laboratory in furtherance of her crime. Gordon then billed her clients for the sampling and analysis. © ft ® Page 5 EPA Bulletin: Sept—Oct 2021 ------- Plea Agreements chose to falsify the required analytical testing under the Act for financial gain," said Special Agent in Charge Charles Carfagno of the Environmental Protection Agency - Criminal Investigation Division's (EPA-CID) South- east Area Branch. "The guilty plea illustrates the consequences of such criminal behavior and that EPA-CID will continue to vigorously investigate those that choose to violate our environmental laws." Gordon pleaded guilty to knowingly and willfully making and using false writings and documents in a matter within the jurisdiction of EPA. She is scheduled to be sentenced on March 22, 2022, and faces a maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. The case was investigated by EPA's Criminal Investigation Division, with assistance from the Mississippi De- partment of Environmental Quality and the Tennessee Department of Environment and Conservation. The case is being prosecuted by a DOJ litigation team. © ft ® Page 6 EPA Bulletin: Sept—Oct 2021 ------- Plea Agreements Oklahoma City Diesel Engine Service Garage Owner Pleads Guilty to Violating the Clean Air Act by Tampering with the Emissions Control Systems on Heavy-Duty Diesel Trucks On October 7, 2021, James Love, 52, of Oklahoma City, pleaded guilty to a single-count felony Information charging him with Tampering with a Monitoring Device and Method Required to be Maintained Under the Clean Air Act, announced Robert J. Troester, Acting United States Attorney for the Western District of Okla- homa. "By causing the removal of pollution control devices, Love caused diesel trucks to spew pollutants into the air at a rate of up to 300 times caused by normal operating vehicles," said Acting U.S. Attorney Troester. "This conduct increased toxins in our environment linked to cancer and pulmonary, neurological, cardiovascular, and immune system damage. To engage in this conduct for financial gain will not be tolerated." "The defendant pled guilty to tampering with diesel truck monitoring systems required under the Clean Air Act" said Special Agent in Charge Christopher R. Brooks of EPA's Criminal Investigation Division in Texas. "He knowingly directed others to reprogram the trucks' Onboard Diagnostic (OBD) systems to prevent the detec- tion of alterations to the emission controls, thereby exposing the public to significant levels of air pollution." On September 20, 2021, Love was charged by Information with violating the Clean Air Act. Love owned and operated Southwest Diesel Service, a heavy-duty diesel engine full-service garage located in Oklahoma City. Love admitted that between February 2015 and April 2019, he directed his employees to modify the emissions control systems on heavy-duty diesel trucks. Specifically, Love directed these employees to alter the emissions control components, including removing the diesel particulate filters (DPFs) and plating the ex- haust gas recirculation systems (EGRs). He then instructed others to reprogram the vehicles' on-board com- puters so that the emissions control systems' sensors failed to detect the alterations. These modifications prevented the trucks from accurately recording the pollutants they discharged into the atmosphere. They also ensured that the trucks continued to travel on public roads despite operating illegally. At sentencing, Love faces up to two years in prison and a $250,000 fine. A sentencing hearing will occur in approximately 90 days from the date of the Plea Agreement. The investigation was conducted by the Oklahoma Environmental Crimes Task Force which includes EPA's Criminal Investigation Division and the Oklahoma Department of Environmental Quality's Criminal Investiga- tion Unit. The case is being prosecuted by DOJ © ft ® Page 7 EPA Bulletin: Sept—Oct 2021 ------- Plea Agreements Kansas Man Pleads Guilty to Water Facility Tampering On October 21, 2021, Wyatt Travnichek, 23, of Lorraine, Kansas pleaded guilty to tampering with the comput- er system at a drinking water treatment facility in Ellsworth County, Kansas. Travnichek pleaded guilty to one count of tampering with a public water system and one count of reckless damage to a protected computer system during unauthorized access. According to court documents, the Post Rock Rural Water District hired Travnichek in January 2.018, and his duties included monitoring the plant after hours using a remote log- in system. Travnichek resigned his position in January 2019. On March 27, 2019, the remote log in system was used to shut down the plant and turn off one of its filters. Investigators established Travnichek's ceil phone was used to perpetrate the intrusion, and that the phone was in his possession at the time of the shutdown. He told investigators he was intoxicated and didn't remember any- thing about the night of March 27, 2019. "Ensuring the security of our nations cyber infrastructure is one of the FBI's top priorities and the plea underscores the joint dedication to that effort by the FBI, EPA and the Kansas Bureau of Investigation. There is no doubt that Travnichek's in- tentional actions directly placed the public in harm's way. The plea should send a clear message to anyone who attempts to tamper with public facilities - law enforcement will remain resolute in investi- gating any and all threats that put the public's health at risk," said FBI Special Agent in Charge Charles Dayoub. "Protecting America's drinking water is a top EPA priority," said Special Agent in Charge Lance Eh- rig of the EPA's Criminal Investigation Division in Kansas. "EPA will continue our focused efforts with DOJ and the states as we investigate and pursue any threats that might be directed toward vital community drinking water resources." The parties recommend a prison sentence of 12 months and one day on counts one and two to run concur- rently. However, a district court judge will determine a sentence after considering the U.S. Sentencing Guide- lines and other statutory factors. The case was investigated by EPA's Criminal Investigation, the FBI and the Kansas Bureau of Investigation. The case is being prosecuted by DOJ. © # ® Page 8 EPA Bulletin: Sept—Oct 2021 ------- Plea Agreements Contract Mail Carrier Pleads Guilty to Vehicle Smuggling Scheme - Child Pornography Dis- covered During Investigation Christopher Cox, 48, of Mason County, Washington resident pleaded guilty on September 20, 2021, in U.S. District Court in Tacoma to three federal felonies related to a smuggling scheme and possession of child por- nography, announced Acting U.S. Attorney Tessa M. Gorman. Christopher M. Cox pleaded guilty to smug- gling goods into the U.S., making false statements related to the Clean Air Act and possession of child por- nography. Cox will be sentenced on December 10, 202.1. According to the plea agreement, between approximately 2015 and January 2019, Cox falsified the required paperwork on two dozen vehicles he imported from overseas. Many of the vehicles were ex- tremely light vehicles imported from Japan that did not meet U.S. safety standards. Cox sold some of the vehicles to contract mail car- riers he knew from his job. Cox falsified the forms that claimed the vehicles met both safety standards and Environmental Protection Agency (EPA) Clean Air Act standards. Cox used his identification as a contract mail carrier to circumvent inspections at the Port of Taco- ma and took the vehicles from the Port without proper inspec- tions. The total value of the imported vehicles exceeds $55,000. Those who bought the vehicles were not told that they failed to meet federal safety and pollution standards. When law enforcement officers served search warrants on Cox's electronic accounts, they observed images of child pornogra- phy. Some of the images are known series of images of child rape and abuse manufactured outside the State of Washington. When officers executed search warrants on Cox's residence and obtained his electronic devices, they located 142 images and 2 videos of child molestation, rape and abuse. Smuggling of goods into the U.S. and possession of child pornography are both punishable by up to 20 years in prison. Making false statements related to the Clean Air Act is punishable by up to 2 years in prison. Under the terms of the plea agreement, the government will recommend no more than 63 months in pris- on. The judge will determine the appropriate sentence after considering the U.S. Sentencing Guidelines and other statutory factors. The case was investigated by Homeland Security Investigations with critical assistance from U.S. Customs and Border Protection (CBP). The case is being prosecuted by DOJ. © * ® Page 9 EPA Bulletin: Sept—Oct 2021 ------- Indictments/Information Horse Cave, Kentucky Man and Company Charged a Second Time for Violations of the Safe Drinking Water Act A federal grand jury returned an indictment on October 13, 2021, charging Charles L. Stinson and Logsdon Valley Oil, Inc., a.k.a. Hart Petroleum, with a violation of the Safe Drinking Water Act. According to the indictment, Stinson, 84, of Horse Cave, Kentucky, and the company, Logsdon Valley Oil, Inc., on or about September 13, 2019, willfully injected fluids into a sinkhole that was not permitted and author- ized by rule for underground injection, at Payton #7 East lease, permit number KYI0420. Court records show that Stinson and Logsdon Valley Oil, Inc., had previously been indicted and convicted for violations of the Safe Drinking Water Act in federal court in Case Number 1:12CR-12-M, in 2013, at the Pay- ton #7 East lease. Stinson pleaded guilty to conspiracy to commit violations of an underground injection con- trol program. In his plea agreement, entered in open court on October 10, 2013, Stinson agreed that it was a part of the conspiracy that he would configure piping to convey fluids from the tank battery to a sinkhole and convey fluids into sinkholes, in violation of the Safe Drinking Water Act. In furtherance of the conspiracy, Stinson and coconspirators improperly conveyed fluids into sinkholes on Payton #7 East lease. Logsdon Val- ley Oil, Inc. was also convicted of two counts of violation of an underground injection control program. In the current indictment, Stinson and Logsdon Valley are charged with one violation of the Safe Drinking Wa- ter Act in violation of Title 42, United States Code, Section 300h-2(b)(2). The defendant is scheduled for an initial court appearance on October 27, 2021, before United States Magistrate Judge H. Brent Brennenstuhl. If convicted, Stinson faces up to 3 years in prison, a fine of $250,000, and up to 3 years of supervised release. Logsdon Valley Oil is subject to a $500,000 fine and up to 3 years of supervised release. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Acting U.S. Attorney Michael A. Bennett and Special Agent in Charge Charles Carfagno of EPA's Criminal In- vestigation Division in Atlanta, Georgia made the announcement. The case is being investigated by EPA's Criminal Investigation Division. A DOJ Assistant U.S. Attorney is prose- cuting the case. An indictment is merely an allegation and all defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. © m Page 10 EPA Bulletin: Sept—Oct 2021 ------- Indictments/Information Signal Peak Energy Admits Violating Health, Safety Regulations at Montana Coal Mine On October 7, 2021, Signal Peak Energy, LLC, which operates an underground coal mine near Roundup, Mon- tana, admitted to criminal charges that it willfully violated health and safety standards and has agreed to pay a $1 million fine as part of proposed plea agreement, Acting U.S. Attorney Leif M. Johnson said. Signal Peak Energy, through a representative, pleaded guilty during an initial appearance and plea hearing to an information charging it with four counts of willful violation of a health and safety standard, a misdemean- or. The maximum penalty is a $250,000 fine. A plea agreement recommends that a criminal fine of $250,000 for each count of conviction, for a total fine of $1 million, is the appropriate disposition of the case. The parties further agree that a sentence of proba- tion is appropriate. If the court accepts the plea agreement, the company does not have an automatic right to withdraw its guilty pleas. If the court rejects the plea agreement, the company can withdraw its guilty pleas and proceed to trial. U.S. Magistrate Judge Timothy J. Cavan presided. A sentencing date before U.S. District Judge Susan P. Watters has not yet been set. "Signal Peak's conduct showed a blatant and callous disregard for its own workers' health and safety and for protecting the environment. Companies that habitually and willfully violate regulations will be investigated and prosecuted to the full extent of the law," Acting U.S. Attorney Johnson said. The Signal Peak Energy prosecution is part of a broad corruption investigation into mine management and operations that resulted in not only worker safety and environmental misdemeanor convictions, but also in individual convictions and charges for some former mine officials and associates for embezzlement, tax eva- sion, bank fraud, money laundering, drugs and firearms violations. Individual convictions of former mine officials included Larry Wayne Price, Jr., former vice president of sur- face operations, who was sentenced to prison for defrauding companies of $20 million; and Zachary Ruble, former surface mine manager, who was sentenced to probation for conspiring to defraud Signal Peak Energy of $2.3 million. A third former mine official, Dale Lee Musgrave, former vice president of underground operations, has plead- ed not guilty to an indictment alleging cocaine trafficking and false statements in mine records and is pending trial. Associated individual cases include Stephen P. Casher, a former Rocky Mountain Bank loan officer, who was sentenced to prison and fined on bank fraud and money laundering charges for a loan scheme involving Larry Price Jr.; James and Timilynn Kisling, owners of Kisling Quality Builders, who were sentenced to probation and fined for conviction of tax evasion in a scheme involving the construction of Larry Price Jr.'s Billings residence; Mark Luciano, a Nevada resident who was sentenced to prison for conviction on trafficking cocaine; and Todd Alan Irwin, a secretary to Larry Price, Jr., who was sentenced to probation for conviction of felon in posses- sion of firearms. © ft ® Page 11 EPA Bulletin: Sept—Oct 2021 ------- Indictments/Information Robert Wayne Ramsey, owner of Peters Equipment Company, has been charged by an information with wire fraud in an alleged equipment sale scheme involving Signal Peak Energy and is pending arraignment. In the Signal Peak Energy case, the government alleged in court documents that from 2013 through 2018, Signal Peak Energy habitually violated mandatory health and safety standards in the Mine Safety and Health Act during the mine's operation. These violations included both environmental safety and worker safety standards. These violations also occurred with the full knowledge, direction and participation of the mine's most senior management during that period, including the president and CEO, the vice president of surface operations, the vice president of underground operations and the safety manager. The government further alleged that during the summer of 2013, Signal Peak Energy's senior managers di- rected mine employees to improperly dispose of mine waste by pumping the waste into abandoned sections of the mine. This waste, known as "slurry," consisted of wastewater, industrial chemicals used in the mining process and unprocessed soil containing heavy metals, including arsenic and lead over groundwater toleranc- es. Mine employees pumped this slurry into the abandoned section of the mine for about two weeks, until the section was full. Disposing mine waste in this manner required approval of both the Mine Safety and Health Administration (MSHA) and the Environmental Protection Agency (EPA), which Signal Peak Energy did not obtain. In the spring of 2015, the government alleged, Signal Peak Energy agents commissioned the drilling of two bore holes through the ground that led to another abandoned section of the mine. Senior mine managers directed employees to pump more slurry into the abandoned section through the bore holes. This slurry was similar to the slurry improperly disposed of in 2013. Estimates vary, but this pumping occurred for up to six weeks. The pumping stopped after a witness discovered that seals between the abandoned mine works and the operating mine had been breached, causing flooding in the areas of the operating mine. Signal Peak Ener- gy obtained a permit to inject water into the ground through the bore holes, but this permit did not allow for the disposal of slurry waste. In January 2018, Signal Peak Energy failed to report as required the injury of an employee, identified as John Doe 1, who was working at the mine when his finger was crushed and required amputation. Doe 1 was mov- ing large mining equipment as part of his duties when some of this equipment fell onto his hand. Doe lmet with the safety manager, who began driving him to the hospital for medical treatment. On the way, Doe 1 had a telephone conversation with the vice president of underground operations. The vice president of un- derground operations pressured Doe 1 not to report the injury as work related and said that he would make it worthwhile for Doe 1. The safety manager witnessed this but did not intervene. The safety manager then dropped off Doe 1 at the hospital rather than accompanying him inside pursuant to mine policy. Doe 1 falsely stated that the injury had occurred at home and was not work related. When Doe 1 returned to work some- time later, the vice president of underground operations gave Doe 1 an envelope containing $2,000. In May 2018, Signal Peak Energy again failed to report an injury as mandated. An employee, identified as John Doe 2, was working in the underground portion of the mine when rock sluffed off the wall and onto Doe 2's head, causing a severe laceration. The shift manager immediately called the safety manager. The safety manager met Doe 2 and drove Doe 2 away from the mine with the stated intention to take Doe 2 to the hos- pital. Instead, the safety manager drove Doe 2 home. Doe 2 waited until the next morning to seek medical attention and falsely stated the injury had been caused by a shelf falling on his head in the garage of his © m Page 12 EPA Bulletin: Sept—Oct 2021 ------- Indictments/Information home. Doctors treated the laceration and Doe 2 returned to work for his next scheduled shift. Doe 2 was un- able to complete the shift or several of the following shifts because of his injuries. Doe 2's lost time was charged against his vacation leave without his approval. The case is being investigated by EPA's Criminal Investigation Division, IRS and FBI. The case is being prose- cuted by a DOJ litigation team. An indictment is merely an allegation and all defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. © * ® Page 13 EPA Bulletin: Sept—Oct 2021 ------- |