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Labs may face $1M fine for handling of information, materials

SANTA FE – The federal Department of Energy has served notice on the operators of the Los Alamos and Sandia national labs that they face almost $1 million in fines, mostly for faulty handling of classified information or material.

Sandia Corp., the private operator of Sandia National Laboratories in Albuquerque, was assessed the biggest fine, $577,500, for violation of control of nuclear weapons data.

The information was presented at improper lab settings and three times in public over many years, and also made its way onto insecure computer servers and information systems, says the DOE’s National Nuclear Security Administration in a preliminary notice of violation issued last week.

Meanwhile, the private contractor at Los Alamos National Laboratory faces a fine of $247,500 for loss of control of classified matter – something described as a secret weapons “item.”

And in a separate incident, Los Alamos National Security LLC was fined $150,000 for exposure of workers to a hazardous material.

Sandia Corp., a Lockheed Martin company, was cited for four “Level 1” violations, said to “involve the actual or high potential for adverse impact on national security,” and two lesser errors.

The violations notice says that, in 2012, a Sandia supervisor discovered that a lab employee had been making presentations at “unclassified settings” at Sandia and at least three times in public venues, dating as far back as 2003. The presentation also was uploaded to a shared server but never had been submitted to Sandia’s classification office for review.

“Due to Sandia’s failure to identify and remove all the classified information contained in the presentation and video, it remained stored and unprotected on this unclassified shared server for over eight years,” says the DOE notice.

Foreign nationals had access to the information for the same length of time.

At some venues where the presentation was made, there were hard-copy handouts, and electronic versions also were provided.

Although Sandia “sanitized” the shared network server after the security breach was discovered in 2012, the lab failed to quickly “conduct additional searches of other unapproved information systems to determine the extent of the problem.” Versions of the presentation were eventually discovered in “over 250 unapproved information systems” throughout Sandia.

“Sandia has taken this security issue seriously since becoming aware of it in 2012,” Jim Danneskiold, a spokesman for Sandia, said in a statement.

“After discovering and reporting the issue, Sandia analyzed the causes and identified, developed and carried out a series of improvements that will reduce the likelihood of security violations of this kind.”

In the Los Alamos security case, LANS – a consortium including Bechtel Corp. and the University of California – was assessed two Level 1 violations, for shortcomings involving documentation of the fate of a “secret/restricted” weapons item that purportedly had been shipped from Los Alamos to the Nevada National Security Site in 2007.

This “item” was never actually shipped, the NNSA confirmed, and a false assumption was created that resulted in “loss of control” of the item, says the notice. A “compromise of classified information” cannot be ruled out, according to the violations notice.

LANS discovered the problems only five years later, in 2012, and “based on unsubstantiated assumptions” concluded that the “classified matter” had been destroyed.

A Los Alamos lab spokesman said Monday that the lab “takes safety and security very seriously and fully cooperates” with investigations. “We are currently evaluating the Preliminary Notice of Violation to formulate our response,” the statement said.

The $150,000 safety fine against LANS in last week’s violation notices was for a 2013 event when five Los Alamos workers were exposed to chlorine, in an event described as “of high safety significance.”