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Owner of tanker repair company pleads guilty to violating safety standards and making false statement to OSHA

21 May 2021

The owner of tanker testing and repair company KCCS Inc. in Idaho, US has pleaded guilty to making an illegal repair to a cargo tanker in violation of the Hazardous Materials Transportation Act (HMTA) and lying to the Occupational Safety and Health Administration (OSHA). The case stems from an incident in August 2018 where an explosion seriously injured an employee.

Representative image: Shutterstock
Representative image: Shutterstock

The US Attorney’s Office for the District of Idaho announced in a statement that it had reached a plea agreement with the owner of KCCS, Loren Kim Jacobson. According to the agreement, the injured KCCS employee’s welder flame pierced the skin of a tanker, which contained residual flammable material, resulting in the tanker exploding.

After the explosion, an OSHA investigator interviewed Jacobson about the circumstances surrounding the accident, as part of an investigation into whether Jacobson had violated OSHA safety standards for cargo tanker repair work. Jacobson made a materially false statement to the OSHA investigator during that interview, namely that his employee was merely an “observer,” not an employee, and that KCCS did not have any employees.

This was an important point, the US Attorney’s Office said, because OSHA requirements only apply to “employers.” Jacobson lied about not having employees to evade legal repercussions and penalties for his violation of various Occupational Safety and Health Act safety standards during the repair that resulted in the explosion.

“The terrible injuries involved this case are a stark reminder of the need for workplace safety requirements and enforcement,” said Acting U.S. Attorney Rafael M. Gonzalez, Jr. “I commend the investigators at OSHA, the Department of Transportation, and the Environmental Protection Agency for uncovering the evidence in this case. Working with our partners, our office will continue to hold employers accountable for criminally endangering their employees.”

Jacobson also admits in the plea agreement that he did not possess the necessary certification to conduct cargo tanker repairs that he regularly conducted. Under the HMTA, all repairs to the skin of a cargo tanker require that the repairperson hold an “R-stamp,” which can be obtained only after meeting extensive training requirements. The purpose of this requirement is to ensure that those conducting repairs on cargo tankers (which often haul flammable materials) have adequate training and expertise to do so safely.

Jacobson admitted that he had a regular practice of making repairs requiring an R-stamp, despite knowing he did not have one, and that he would send employees into the cargo tankers to weld patches from the inside of the tanker so that the illegal repairs would not be visible from the outside. Jacobson did not follow OSHA safety standards for protecting employees from such dangerous “confined space entries.” According to the plea agreement, Jacobson directed his employee to conduct a hidden repair of this type on the tanker that subsequently exploded, in violation of both OSHA safety standards and the R-stamp requirement.

“The Environmental Crimes Section’s Worker Safety Initiative is designed to make sure that employers like Loren Jacobson, who shirk safety requirements and put their employees, customers, and the public at risk, are held accountable for their actions,” said Acting Assistant Attorney General Jean Williams for the Justice Department’s Environment and Natural Resources Division. “We are committed to protecting the lives and health of those who do the important work of keeping safe cargo vehicles on the road. This prosecution makes clear to others who might be tempted to ignore these certification and safety programs that they will face felony consequences for putting their employees and the public in danger.”

Jacobson is scheduled to be sentenced on August 25, 2021. Both the HMTA violation and the false statement offenses that Jacobson pleaded guilty to are punishable by up to five years in prison, up to three years of supervised release, and a fine of up to $250,000.


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