Is keeping ‘two sets of books’ a problem?

June 29, 2011 by Ken Ward Jr.

MSHA officials — from left to right, Patricia Smith, Kevin Stricklin and Joe Main — await the start of a press conference Wednesday. Photo by Ken Ward Jr.

Officials from the U.S. Mine Safety and Health Administration — with a little help from initial media reports like mine last night — have probably confused things a bit on this business about Massey Energy keeping “two sets of books” at the Upper Big Branch Mine.

So let’s see if we can sort this out and be real clear here.

First, they weren’t really keeping “two sets” of mine examination books. At least not two sets of, for example, “pre-shift examination” books. They didn’t have one pre-shift book that they recorded hazards in and other they didn’t. They didn’t show the clean one to MSHA and keep the “dirty” one secret from government inspectors.

The situation MSHA described during today’s briefing is just slightly more complex than that.  My buddy Howard Berkes over at NPR probably did a better job of explaining this than I did, so let’s take a look at what Howard reported early this morning:

Mine owner Massey Energy kept two sets of records that chronicled safety problems. One internal set of production reports detailed those problems and how they delayed coal production. But the other records, which are reviewed by federal mine safety inspectors and required by federal law, failed to mention the same safety hazards. Some of the hazards that were not disclosed are identical to those believed to have contributed to the explosion.

During today’s public briefing, MSHA coal administrator Kevin Stricklin offered three examples of instances where hazards identified on Massey’s internal and previously provide production reports were not listed on official mine examination reports that are regularly available to inspectors (not to mention used, at least supposedly, to warn miners of problems and ensure those problems are fixed).

Take a look at those examples, by turning to pages 39-41 of the slide presentation Kevin used during today’s briefing.

To offer just one instance, a production report for March 2, 2010, said the company spent 25 minutes “re-ventilating”  to get methane — recorded initially at 1.5 percent — down to 0.3 percent. The examination report for that same shift and part of the mine lists no hazards, and simply recorded methane at 0.3 percent.

The issue here, then, is this:  Were mine examinations at Upper Big Branch inadequate, so that hazards were not identified, recorded and fixed? Or perhaps were hazards ignored, and the records falsified? Falsifying the books is a felony, and the most serious criminal violation currently on the books under federal mine safety law.

One interesting thing here is that former Massey CEO Don Blankenship’s micromanaging is part of what led Massey mines to have much more detailed “production records,” than many other coal operations. So it’s possible that all of this detail about why production slowed or stopped at particular times might end up coming back to bite Massey … if federal prosecutors really dig into these records and find lots of inconsistencies.

On the other hand, keep in mind that the production records could and in at least some cases probably were, kept by someone different from the examination records. And information on them may have been recorded at different times, perhaps long after a pre-shift examination was completed, for example. So to prosecute anyone, federal officials are going to have a challenging road ahead on this stuff.

I asked U.S. Attorney Booth Goodwin if his office was looking specifically at this issue, and he didn’t want to say … but he did add:

Our investigation is continuing into all matters related to the conditions at and affairs at Upper Big Branch.

Stay tuned …

 

 

11 Responses to “Is keeping ‘two sets of books’ a problem?”

  1. John S says:

    Well, it’s not a problem if not logging in the official books was an oversight. But it is a big problem if it was a deliberate attempt to deceive.

    Now that the Supreme Court has determined that corporations are people, which ones will go to prison if found guilty of a felony?

  2. MGP says:

    According to the production report, there was 25 minutes of downtime after 1.5% methane was detected in or around #3. The downtime is required under 30 CFR 75.323(b)(2). What did UBB do wrong? The onshift exam correctly identifies the amount of methane at the time of the exam. The production report identifies the same quantity, and also reflects that UBB complied with the standard and ceased production. Finally, the production report provided far greater detail for the oncoming shift than was required under the law. If it was a “second set of books,” it deserves credit for being better than the law requires, not worse.

  3. tf1 says:

    MGP, they hid the information from MSHA inspectors. This is not some innocent oversight.

  4. New age Miner says:

    MGP- The problem is not “downing” the wall due to increased amount of methane, the problem is it wasn’t recorded into the “on-shift” exam book. According to the report, “a production report for March 2, 2010, said the company spent 25 minutes “re-ventilating” to get methane — recorded initially at 1.5 percent — down to 0.3 percent. The examination report for that same shift and part of the mine lists no hazards, and simply recorded methane at 0.3 percent.” That’s the problem. You don’t find a hazardous condition during your on-shift exam and record it in the production book! Massey recorded this hazardous condition in their production report because it’s not a required record book according to MSHA’a 30 CFR. Massey knew they could hide this record because of it and now look what’s happened. If the nations “pre-shift/on-shift record books” are like the ones we use, IT’S ALL IN THE SAME BOOK.
    This is just another way Massey was trying to minupulate the system and hide hazards conditions just to brag to their share-holders, “S1-P2″!

  5. MGP says:

    I don’t understand how MSHA can conclude that there was intent to mislead or deceive. At least with this one example, they don’t appear to be hiding anything. An MSHA inspector was at UBB on the owl and day shifts of March 1 and 2, 2010. UBB wasn’t hiding anything in these books.

    MSHA states that, “CM section should have been evacuated and power disconnected – (1.5% methane) – they just waited 25 minutes for it to clear”.

    If MSHA wants an entire continuous miner section to be evacuated, they need to change the law accordingly to define the “affected area” under 75.323 as the working section. As it is, the affected area would have been the working place, not the entire CM section (which would have encompassed even more under the law than just the working section.)

    MSHA is misrepresenting the information in these reports and the requirements of the standards.

  6. MGP says:

    NaM: If 1.5% methane was observed at the time of the onshift exam, I agree that it should have been recorded in the exam record and that the production report could be regarded as indicating a possible knowing violation of the law.

    What isn’t clear is when the 1.5% was observed. It looks to me like it was observed sometime after the onshift exam was completed.

    Also, I believe that this a a continuous miner section, developing the future headgate of a longwall panel, not the longwall itself.

  7. New age Miner says:

    MGP-UBB wasn’t hiding anything the night that the inspector was their. They just wasn’t showing MSHA their production reports where ALL the imminent dangers exist.

    1st. The production reports are not required under the CFR and because of this Massey is not required to show them to MSHA. This is deceptive and misleading. They should have recorded the hazardous conditions in their “on-shift” report, not production report.

    2nd. Read 75.323(b)(2)(ii). Massey did not disconnect the power from the CM section. Instead, they just waited around 25 minutes for it to be ventilated. According to 323 if you encounter 1% of methane you immediately begin working on removing the methane. If you find 1.5% you must disconnect power at the source. That means even the power center on the section must be turned off.

  8. MGP says:

    NaM: I don’t think that I disagree with you in principle. I only question that these facts support the conclusions you are making.

    For instance, if this is a continuous miner section and the methane was detected in the face (which I think is likely), that probably means that power was automatically knocked on the continuous miner machine by its internal methane sensor.

    If so, UBB would not likely have been able to tram the miner out of the face, and would have had to disconnect the miner from the power center and adjusted ventilation to the face while waiting for the methane in the face to fall below 1.5%.

    I simply need more information before I can conclude that UBB was deliberately attempting to circumvent the requirements for examinations.

  9. New age Miner says:

    MGP- You’re right, it was a continuous miner section. I just don’t know of any other reason for them to NOT record this hazardous condition into the “on-shift” record other than fear that MSHA (or their share holders) would find it. Looking at it from a Foremans perspective, I have seen instances when company’s would faint should you find and record a “hazard” in any record book.

  10. Ken Ward Jr. says:

    Folks,

    Thanks for all the comments on this … very interesting discussion.

    A couple of things:

    First, if hazards are not recorded in the examination books, it’s a problem. Period. That’s regardless of the reason … If they were intentionally covered up, that is potentially criminal. If not writing them in the book was a simple mistake, that’s still a violation of the MSHA standards. If the hazards were not recognized by the examiner, that’s also a violation, for inadequate examinations.

    Second, in the example given in my blog post, it’s simply not clear from the records MSHA displayed whether the timing was such that the hazard was present when the examination was done or was discovered later. That’s the point I was trying to make when I wrote:

    “On the other hand, keep in mind that the production records could and in at least some cases probably were, kept by someone different from the examination records. And information on them may have been recorded at different times, perhaps long after a pre-shift examination was completed, for example. So to prosecute anyone, federal officials are going to have a challenging road ahead on this stuff.”

    Finally, it’s also worth looking at the other two examples that MSHA provided:

    — A March 1, 2010, examination report indicating no hazards, while a maintenance report for the same day reported:

    “Added 5 gal oil to T/E ranging arm. Had no water on either drum, cleaned
    several and stopped right back up, removed 8 on each end, ran like that
    rest of shift to try and flush drums, told 3rd shift”

    — A March 16, 2010, examination report again indicating no hazards, while a production report for that day indicated:

    “Low Air in LOB. Doors outby going to HG22 Tail open 7:00-8:10…Adverse Roof condition their coal streak four ?5’ up. Falling out to it in #1 2.”

    Keep in mind also that these are the only examples MSHA provided, and we haven’t seen all of the production reports — and don’t know what, if any, testimony from miner or mine management MSHA has obtained (let alone whatever DOJ has obtained) that might fill out answers to some of the questions everyone rightly has about all of this.

    Thanks again for all of the comments.

    Ken.

  11. Jerry says:

    Just an observation – this is a further illustration of why industry cannot and must not be allowed to regulate themselves. And oh yeah, lest we forget, the regulators must meet their responsibilities and REGULATE.
    Companies have one prime directive: make money. Everything else is secondary. Personally I don’t have a problem with it – it’s the nature of the beast. What should go hand-in-hand with this prime directive is the government’s regulation OF the industry, with their prime directive being to allow the industry to make money while keeping the employees safe.
    Is this concept so hard to understand?

Leave a Reply