NukeGate Probe: The Turn Of Westinghouse

Toshiba is next …

This week, mainstream media outlets in South Carolina breathlessly reported on the latest criminal indictment accompanying the NukeGate scandal – the botched construction of a pair of abandoned, next generation nuclear reactors in Fairfield county.

Words like “exclusive” and “breaking” were tossed around, but regular readers of this news outlet already knew what was coming …

Back in December, I published this report detailing the trajectory of the probe – specifically identifying its next targets. Oh, and in February I wrote this column lambasting investigators and prosecutors for their apparent failure to focus on one target in particular – the state’s spectacularly failed government-run utility, Santee Cooper.

Santee Cooper and former South Carolina energy utility SCANA were partners in this project – and partners in concealing its impending collapse from unsuspecting ratepayers, investors and taxpayers.

This failed command economic boondoggle – spearheaded by liberal lawmakers including S.C. Senate judiciary chairman Luke Rankin – has cost Palmetto State ratepayers and taxpayers more than $10 billion, for which they have received barely pennies on the dollar in compensation (see here and here). That total included more than $2 billion (and counting) in investment risk socialized by ratepayers thanks to Rankin and his colleagues in the S.C. General Assembly.

Astoundingly, these lawmakers are still refusing to offload Santee Cooper to the private sector – even though its embarrassingly anemic “reform” plan offers absolutely no solution whatsoever for its $7 billion (and counting) mountain of debt.

Even more unbelievably, these lawmakers are trusting Rankin and his cohorts with the reins of a utility that they have already driven into the ground once already …

Gotta love that “Republican” rule, right?

Anyway, back to the criminal probe …

Carl Churchman – a former executive at Westinghouse – agreed earlier this week to plead guilty to making false statements to federal investigators in connection with their ongoing inquiries into this debacle. He faces up to five years behind bars and a potential fine of up to $250,000.

As I noted in my prior coverage, this announcement came as no surprise to my readers. They already knew the guilty pleas obtained last year from SCANA executives Kevin Marsh and Stephen A. Byrne were mostly about compelling testimony to aid investigators in moving against Westinghouse and its parent company, Toshiba.

“Federal prosecutors are clearly focused on making cases against Westinghouse – the contractor on the construction of the failed reactors – and its parent company, Toshiba,” I wrote back in December. “To the extent Marsh and Byrne’s cooperation is being sought at the federal level, (I) believe it is primarily with those targets in mind.”

Well, chalk another one up for my website’s amazing network of sources …

In fact, federal prosecutors told U.S. district court judge Mary Geiger Lewis this week that Churchman “is a key witness for us.”

“We view this as a preamble to the case,” assistant U.S. Attorney Winston Holliday told Lewis. “There’s more to come.”



Indeed, additional Westinghouse executives are likely to be charged in the months to come. Unfortunately, there remains no indication that Santee Cooper executives are going to be held accountable for their actions – which is absolutely inexcusable given their conduct in connection with this disaster. In fact reporter Avery Wilks of The (Charleston, S.C.) Post and Courier – which has shown the government-run monopoly all sorts of favoritism – noted in his coverage of the Westinghouse plea that “the investigation does not appear to target anyone from Santee Cooper … which played a more limited role in managing the project.”


So “limited” criminality is okay with Wilks and his editors? Good to know …

As I have previously reported, Santee Cooper flat out lied to its investors on bond documents related to this project … and attempted to raise rates on its customers just a week before pulling the plug on this project.

Oh, and let’s not forget the broader deception of the public it engaged in along with SCANA … over periods of many months (if not years).

Again, letting Santee Cooper slide for its role in a multi-billion dollar deception of South Carolina ratepayers and taxpayers would be an absolutely galling miscarriage of justice – one which would erode faith in prosecutorial institutions in this state far worse than the half-finished ProbeGate investigation of corruption at the S.C. State House.

Of course, the real issue moving forward is what happens to Santee Cooper – especially in light of its deteriorating cash position. Selling this rogue agency when I first proposed doing so back in March 2008 would have resulted in a multi-billion dollar payday to the state … not the escalating debt the utility is currently staring down in the aftermath of NukeGate.

When will lawmakers figure out that running an electric company is not a core function of government?



(Via: FITSNews)

Will Folks is the founding editor of the news outlet you are currently reading. Prior to founding FITSNews, he served as press secretary to the governor of South Carolina. He lives in the Midlands region of the state with his wife and seven children. And yes, he has LOTS of hats (including that Minnesota Twins’ lid pictured above).



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