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Former Hunters Point shipyard cleanup workers plead guilty to fraud

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First criminal convictions in widening toxic cleanup scandal

Hunter’s Point Shipyard. Photo by Associated Press/Eric Risberg

Two former supervisors at Tetra Tech EC, the company at the center of a widening fraud scandal at the former Navy shipyard in San Francisco’s Hunters Point, have pleaded guilty to faking documents and were sentenced to federal prison terms, the Justice Department announced late Thursday.

Stephen Rolfe and Justin Hubbard will both serve terms of eight months in federal prison and pay fines of $2,000 and $10,000, respectively, according to a news release from Alex G. Tse, the acting United States attorney for Northern California.

It’s not clear if other Tetra Tech managers or employees are under investigation, or if other criminal indictments are forthcoming.

But their guilty pleas and subsequent sentences represent the first instance of criminal penalties stemming from malfeasance at the shipyard, a sprawling, decades-long, $1.1 billion toxic cleanup project that, within the last year, has devolved into an environmental fiasco and attracted national attention.

This is vindication for other former cleanup employees—co-workers and subordinates of Rolfe and Hubbard, whose detailed and repeated whistleblower allegations of fraud appear to have led to their convictions.

And if the rest of the whistleblowers’ allegations are correct, more indictments may be coming.

Sworn declarations from multiple former cleanup employees allege that other Tetra Tech managers and supervisors directed them to commit fraud on multiple occasions.

Tetra Tech EC, a subsidiary of Tetra Tech, Inc., a multi-billion-dollar firm with a history of winning government contracts, received a $300 million contract from the U.S. Navy to prepare the former shipyard—an EPA Superfund site rife with industrial and radioactive contamination stemming from its use as a warship repair base and nuclear warfare research lab—for redevelopment.

The shipyard is seen as the anchor for a new neighborhood in San Francisco’s historically economically disadvantaged southeastern quadrant.

One area of the shipyard, a hilltop area called Parcel A that was transferred to San Francisco for redevelopment in 2004, has more than 300 units of occupied housing, in a development called The SF Shipyard.

The Navy first noticed problems with cleanup data presented by Tetra Tech in 2011 and 2012.

Later accounts from whistleblowers, first aired by NBC Bay Area, alleged that the company’s work was compromised by widespread and organized fraud, a con job committed at the behest of Tetra Tech officials.

When the whistleblowers raised concerns with Tetra Tech management, they were disciplined and ultimately fired, they claimed.

These allegations halted the transfer of shipyard land from the Navy to the city for redevelopment in 2016.

As first reported by Curbed SF, a subsequent investigation revealed that almost half of the investigation and remediation of hazardous waste performed by the company at the shipyard—an EPA Superfund site rife with industrial and radioactive contamination—showed signs of fraud.

A later review from the U.S. EPA, first made public by a public-employee accountability organization, concluded that nearly 100 percent of Tetra Tech’s work could not be trusted.

To date, Tetra Tech has defended its work and denied any wrongdoing, and has offered to pay for a third-party contractor to test the site to prove it.

In a statement issued late Thursday night via spokesman Sam Singer, Tetra Tech vowed to “pursue all legal actions available to it to recover the harm that the actions of these former employees have caused to Tetra Tech, the Navy, and the local community.”

To date, the company has escaped punishment of any kind for the scandal. In 2016, the company was fined $7,000 by the Nuclear Regulatory Commission, a fine that was later waived on appeal.

It was not immediately clear when Rolfe and Hubbard parted ways with the company.

The pair both pleaded guilty to falsifying documents last year, according to documents unsealed this week. Rolfe is already serving his prison term, while Hubbard is scheduled to surrender to authorities in July.

According to the plea agreements, Hubbard collected clean soil from outside his designated work area and put them into containers that identified them as originating from the toxic shipyard.

Rolfe admitted that he ordered employees to fake dirt sampling in a similar way “on approximately 20 occasions,” and knowingly falsified other documentation in a way that “would impede… the U.S. Navy’s radiological remediation efforts at the former naval shipyard.”

As per U.S. Attorney Tse, Hubbard was sentenced on May 2. Rolfe was sentenced on January 24. Both men pleaded guilty in 2017. Their plea agreements were not unsealed until this week, when Hubbard’s sentence was handed down.

According to testimony from Archie Jackson, another former employee, Rolfe and Hubbard were allegedly part of a “clique” led by Bill Dougherty, Tetra Tech’s project manager.

The clique “did whatever Dougherty wanted, including cutting radiological corners,” Jackson alleged in a sworn statement.

Susan Andrews, a former radiation technician, claimed that other Tetra Tec higher-ups, including construction manager Dennis McWade, ordered her to destroy data that allowed metal fencing contaminated with low-level radiation to be returned to the company from which it was rented.

These allegations were all reported to the Nuclear Regulatory Commission, according to Andrews’ and Jackson’s sworn statements. To date, it is unclear if any action or investigation followed.

Update: Hunters Point shipyard housing: Fraud coupled with contamination discoveries fuel doubt, calls to test area