New EPA Enforcement Policy

July 11, 2019
EPA announced a final policy to enhance effective partnerships with states in civil enforcement and compliance assurance work.  Articulated in a memorandum from EPA’s Assistant Administrator for Enforcement and Compliance Assurance Susan Bodine, the final policy describes procedures and practices for effective coordination between EPA and states when carrying out shared responsibilities under environmental laws.
“The policy reflects the dialogue we have had with our state partners on enhancing our work together,” said Susan Bodine, EPA's Assistant Administrator for Enforcement and Compliance Assurance. “The final policy clarifies roles and provides a clear roadmap that EPA and our state partners can use to more effectively achieve our shared goal of increasing compliance with environmental regulations.”
“The Environmental Council of the States committed to this partnership with USEPA to drive improvements in effective and efficient enforcement and compliance assurance outcomes. We look forward to better realization of shared goals for future environmental progress.”said Becky W. Keogh, ECOS President and Arkansas Department of Energy and Environment Secretary. "We look forward to better realization of shared goals for future environmental progress."
The final policy memorandum is divided into three sections.  The first section details requirements for joint planning and regular communication between EPA and states to promote enhanced, shared accountability.  The second section of the policy provides greater detail on EPA and state roles and responsibilities in implementing authorized programs.  The third and last section of the policy provides a process for the elevation and resolution of issues.
The issuance of the final policy replaces the interim guidance memorandum on enhanced planning and communication between EPA regional offices and states issued by Susan Bodine on January 22, 2018.  EPA indicated that it would update and finalize that guidance based on input from EPA regional offices, states, and a workgroup on compliance assurance that EPA and the Environmental Council of States convened in September of 2017. the EPA and the States in Civil Enforcement and Compliance Assurance Work.
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Connecticut to Revise Remediation Standard Regulations
The Connecticut Department of Energy and Environmental Protection (DEEP) posted for public review and comment its proposed amendments to Sections 22a-133k-1 to 22a-133k-3, inclusive, of the Regulations of Connecticut State Agencies, also known as the Remediation Standard Regulations (RSRs). 
The regulations specify the standards for the cleanup of environmental pollution in soil and groundwater at polluted properties, including brownfields parcels eligible to become revitalized and redeveloped to foster economic growth. The proposed amendments allow for faster cleanups and increased predictability in cleaning up pollution, while continuing to protect human health and the environment.
In June 2019, Commissioner Katie Dykes announced DEEP’s 20BY20 goals for predictability, efficiency, and transparency to strengthen DEEP’s environmental regulatory and permitting process to be completed by December 2020. The launch of the public notice period for the proposed amendments to the RSRs begins the fulfilment of “Goal 5: Finalize RSR and EUR Regulations” to provide clearer standards for environmental cleanups.
The proposed amendments modify and create new ways to achieve compliance with the regulations, including many that can be implemented by an environmental professional licensed in the state of Connecticut without DEEP’s prior approval. These new compliance tools include certain types of engineered controls, calculation of certain alternative criteria, and in conjunction with the forthcoming Environmental Use Restriction (EUR) Regulations, the implementation of Notice of Activity and Use Limitations (NAULs), which under certain circumstances can be used as an alternative to Environmental Land Use Restrictions (ELURs). The proposed regulations also create streamlined approaches when soil and groundwater at a site are polluted as the result of the application of pesticides.  The proposed amendments will add clarity and flexibility for the reuse of soils on the parcel being remediated, on abutting parcels, and on parcels impacted by the same release, and will also allow for reuse of certain soils on other agricultural properties.
The proposed amendments also ensure human health and the environment remain protected. Enhancements include updates to cleanup criteria and depth of pollution, specifically pertaining to vapor migration of chlorinated organic substances into buildings, and require certain compliance exits to use EURs when they may not have been previously required.
DEEP will be offering informational meetings on the following dates:
  • July 30, 2019, from 9:30 to 11:30 am at DEEP Headquarters, 79 Elm Street, Hartford; 
  • August 6, 2019, from 1:30 to 3:30 pm at the Kellogg Environmental Center, 500 Hawthorne Avenue, Derby; and 
  • September 11, 2019, from 5:00 to 7:00 pm at the Sheraton Hartford South Hotel, 100 Capital Boulevard, Rocky Hill. 
The public notice process will last 90 days, until 5:00 pm on October 7, 2019, during which formal comments may be submitted in writing by that deadline using the eRegulations system; or to Brian Thompson at DEEP, Bureau of Water Protection and Land Reuse, Remediation Division, 2nd Floor, 79 Elm Street, Hartford, Connecticut 06106-5127 or at A Public Hearing, at which the public may make verbal comments, is scheduled for September 25, 2019 at 1:00 pm at DEEP Headquarters, 79 Elm Street, Hartford, Connecticut.
Bio Fuel Scammer Convicted
On May 1, 2019, a jury convicted David Dunham on 54 of 55 counts charged for engaging in a multi-million dollar conspiracy to defraud individuals and the United States in a green energy scam involving used cooking oil. Dunham was found guilty of conspiracy, false statements, wire fraud, tax fraud, and obstruction violations (18 U.S.C. §§ 371, 1001, 1343, 1519; 26 U.S.C. §§ 7206, 7212).
Between 2010 and 2012, Dunham and co-defendant Ralph Tommaso operated, respectively, Smarter Fuel, Inc., and Environmental Energy Recycling Corporation, LLC, coordinating the activities of these companies, and then formally merging under the umbrella of Greenworks Holdings, LLC. According to the evidence, the defendants falsely claimed to have produced and sold renewable fuel for which they misappropriated approximately $50 million in payments, subsidies, and other benefits. Dunham and Tommaso defrauded government programs intended to encourage the production of renewable fuel as an alternative to traditional fossil fuel. By claiming credits for renewable fuel they never produced, and that otherwise did not qualify, they stole tens of millions of dollars from the United States government. Dunham and Tommaso also stole millions more by fraudulently claiming and generating credits that they sold to unsuspecting purchasers who believed these credits satisfied their legal obligation to introduce a certain quantity of renewable fuel per year.
The defendants, through their companies, collected used cooking oil from restaurants and other food service locations, sometimes processing it to remove hard particles, water, and other waste. They then sold this cleaned cooking oil primarily to renewable fuel producers that used it as a “feedstock” ingredient in their production process. Dunham and Tommaso did not sell their cleaned used cooking oil as a final fuel, but fraudulently claimed otherwise, applying for and receiving government subsidies for every gallon of cleaned used cooking oil that they produced, plus more. Their claims vastly exceeded actual production. In 2010, they claimed subsidies and other payments on more than 17.5 million gallons of product, when they produced less than six million gallons. In 2011, they claimed subsidies and other payments of more than 18 million gallons, when they only produced approximately 7.5 million gallons. Of the cleaned used cooking oil they did produce, the vast majority did not qualify for credit or subsidy. Dunham and Tommaso’s fraudulent claims included more than one million gallons of process wastewater generated from cleaning the used cooking oil, the non-fuel sales of their product as a feedstock ingredient to be used by biofuel producers in buyers’ production of biofuel, and transactions that existed on paper only. Dunham and Tommaso provided false information and altered documents to government and private auditors in an effort to conceal their fraud. They directed employees to alter the documentation of obviously unqualified sales and change them to show sales that qualified for subsidies and other payments.
Dunham underreported his taxable income for the tax years 2009 and 2010. In his filings for these years, Dunham altered the dates on sales invoices, and delayed generating invoices on other sales, in order to avoid paying taxes on these sales until a subsequent tax year. He also obstructed an Internal Revenue Service audit of Smarter Fuel.
In a related matter, William Barnes, a professional engineer, pleaded guilty in March 2016, to conspiring to provide false statements related to the approval of reports falsified on behalf of Dunham and Tommaso (18 U.S.C. § 371). He is scheduled to be sentenced on September 5, 2019. Tommaso pleaded guilty to conspiracy in November 2017 and is scheduled to be sentenced August 27, 2019.
This case was investigated by the EPA Criminal Investigation Division, IRS
Criminal Investigations, Department of Agriculture Office of Inspector General, U.S. Postal Inspector Service, and the Federal Bureau of Investigation.
Property Owner Guilty of Asbestos NESHAP Violations
On May 30, 2019, Aleks Rakaj pleaded guilty to violating the Clean Air Act (CAA) National Emission Standards for Hazardous Air Pollutants (NESHAPs) for the illegal removal of asbestos (42 U.S.C. §§ 7412 and 7413(c)(1)). Rakaj is scheduled to be sentenced on August 14, 2019.
In November 2015, Aleks Rakaj and his two cousins, Kliton and Rezard Rakaj, purchased a commercial property located at 206 Wallace Street in New Haven, Connecticut. Prior to purchasing this property, the realtor informed them of asbestos in the building. After they bought it, they began to remove the asbestos without following the NESHAPs provisions, including: failing to adequately wet regulated asbestos-containing material while removing it from pipes, failing to notify local officials ten days prior to beginning the job, and failing to properly dispose of the material.
After a local health department inspector conducted an unannounced inspection of the facility, he observed the ongoing activities as well as approximately 100 to 150 garbage bags of dry and unlabeled suspected asbestos-containing material. None of the personnel engaged in the abatement wore proper protective equipment, nor were they trained or certified in asbestos removal. After agents executed a search warrant a few weeks later, they confirmed the presence of asbestos.
On April 2, 2019, a court sentenced Kliton Rakaj and Rezart Rakaj to each pay a $9,500 fine, complete a one-year term or probation, and perform 50 hours’ community service. Both pleaded guilty to violating the CAA NESHAPs.
The case was investigated by the EPA Criminal Investigation Division, with assistance from the City of New Haven Health Department and OSHA.
Two Men Sentenced for Oil Spill
A court recently sentenced Christopher Srubar and Curtis Dantin to complete one-year terms of probation. Srubar also will pay a $2,500 fine. Both previously pleaded guilty to a misdemeanor Clean Water Act (CWA) violation for their roles in the November 2012 explosion on an offshore oil production platform located in the Gulf of Mexico (33 U.S.C. § 1319(c)(1)(A)).
Srubar, Dantin, and Don Moss (who previously pleaded guilty) acted negligently for conducting hot work operations on the platform that caused a massive explosion on the platform. Approximately 500 barrels of oil spilled into the Gulf of Mexico and a significant portion of it caught fire. Grand Isle Shipyard LLC (which supplied personnel) also pleaded guilty to a CWA negligence count and was sentenced to pay a $500,000 fine. Black Elk Energy Offshore Services (which owned and operated the platform), and Wood Group PSN (which also supplied personnel) pleaded guilty and were sentenced in 2017. A court previously sentenced Moss to pay a $2,500 fine and complete a one-year term of probation.
This case was investigated by the Department of Interior Bureau of Safety and Environmental Enforcement and the EPA Criminal Investigation Division.
Another Company Fined for Participating in VW Emissions Fraud
A court recently sentenced IAV GmbH (IAV) to pay a $35 million fine and complete a two-year term of probation, to include the engagement of an independent corporate compliance monitor.
IAV, a German company that engineers and designs automotive systems, pleaded guilty for its role in a long-running scheme with Volkswagen AG (VW) to sell diesel vehicles in the United States by using a defeat device to cheat on U.S. emissions tests. IAV pleaded guilty to one count of conspiracy to defraud the U.S. and VW’s U.S. customers and to violate the Clean Air Act by misleading the EPA and U.S. customers about whether certain VW and Audi-branded diesel vehicles complied with U.S. emissions standards (18 U.S.C. § 371). IAV and its co-conspirators knew the vehicles did not meet U.S. emissions standards, worked collaboratively to design, test, and implement cheating software to cheat the U.S. testing process, and IAV knew that VW concealed material facts about its cheating from U.S. regulators and customers
This plea agreement represents the most recent charges in an ongoing criminal investigation by U.S. authorities into unprecedented emissions cheating by VW. In March 2017, VW pleaded guilty to criminal charges that it deceived U.S. regulatory agencies, including the EPA and the California Air Resources Board, by installing defeat devices in diesel vehicles emissions control systems that were designed to cheat emissions tests. VW paid a criminal fine of $2.8 billion and is subject to the oversight of an independent corporate compliance monitor for three years. Prosecutors previously indicted eight individuals in connection with this matter, two of whom have pleaded guilty and been sentenced. The other six are believed to reside in Germany.
This case was investigated by the Federal Bureau of Investigation and the EPA Criminal Investigation Division.
Vermont Animal Feed Facility Settles EPA Toxic Chemical Right-to-Know Allegations
EPA’s New England regional office has reached a settlement with a Vermont animal feed supplement supplier that failed to report information about toxic chemical compounds at its manufacturing facility.
Under the settlement filed on April 29, Nutra-Blend, L.L.C., of Neosho, Missouri, which does business under the name of Old Mill Troy at a facility in St. Albans, has agreed to pay $111,060 to settle EPA allegations that the company failed to comply with federal right-to-know laws in 2017 when it failed to file required reports describing five toxic chemical compounds used at the facility. The reports, Toxics Release Inventory (TRI) forms, are required under the federal Emergency Planning and Community Right-to-Know Act.
"Failing to report information about these chemical compounds in a timely way deprived the surrounding community of its right to know about toxic chemicals that could have affected public health or the environment," said EPA New England Acting Regional Administrator Deborah Szaro.
This case stems from an EPA inspection of the facility in September 2018. Nutra-Blend submitted the five missing TRI reports for zinc, manganese, selenium, copper and cobalt compounds within a week after EPA's inspection and was cooperative during the inspection process and case settlement negotiations.
At the Old Mill Troy facility, Nutra-Blend manufactures animal feed supplements by blending dry vitamins, minerals and other nutrients. Each year, the facility processes zinc, manganese, selenium, copper and cobalt compounds each in quantities of over 25,000 pounds, which is the threshold for reporting these toxic compounds on federal TRI forms. All of these chemical compounds are hazardous to aquatic life.
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