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The final Department of Energy Inspector General report on the incident still has not come out yet.
But on Friday, Beth Sellers, the deputy director of the Los Alamos National Laboratory who was at the center of the investigation, resigned her post.
In her statement, Sellers said, “You may soon read news coverage about an issue involving the laboratory. A family member of mine was awarded a consulting agreement with the lab in the fall of 2012. At the time, this was not properly disclosed for full evaluation of potential conflict of interest. I realized this mistake several months later and immediately requested a review from lab counsel and audits and ethics.
“We undertook a comprehensive review of our processes and several improvements have been made to prevent a recurrence, but it is apparent to me that this incident will be a continuing distraction to the lab’s important missions.
“This is unacceptable to me as a laboratory leader, so I have decided to voluntarily step down. I will work with (lab director) Charlie (McMillan) to transition my duties.
Working for Los Alamos has been an honor and a privilege. The lab does great things, and I wish you continued success. The nation needs Los Alamos now more than ever.”
McMillan, meanwhile, accepted Sellers’ resignation Friday.
“Beth Sellers has made me aware of her intent to resign as the laboratory’s deputy director. It is with regret that I’ve decided to accept her resignation,” Sellers said. “I do this so that the lab can move quickly past any institutional distraction and continue to deliver on our mission.
“I thank Beth for her service to the laboratory and the nation. Her contributions will be missed, especially her energy and
passion for the laboratory mission and her deep interest in the lab’s people. After a short transition of duties, we will begin the search for Beth’s successor.”
Last month, the Los Alamos Monitor obtained a draft IG report about this incident and filed a story that did not list the names of Beth Sellers or her husband William.
The draft report detailed a possible conflict of interest in a consultant agreement awarded to William Sellers who was the spouse of Beth Sellers at LANL.
In a memorandum to the acting manager of the Los Alamos Field Office from Sandra D. Bruce, the assistant inspector general, it was alleged that the Sellers never disclosed their spousal relationship to LANL.
The document went onto to say that it was further alleged that work was performed before the consultant agreement was signed and also that hours were charged by William Sellers, who declined comment, was not performed.
The inspection, meanwhile, substantiated all aspects of the allegation.
The report said, “We found that LANL inappropriately awarded a sole source consultant agreement to an individual who was the spouse of a senior LANL manager.
“We also discovered that the consultant did not disclose his spousal relationship with the senior LANL manager at the time of the award.”
The lab said in a statement back in February: ““When our ethics office became aware of this consulting contract and reviewed the facts, the lab found the arrangement did not comply with internal policies relating
to contracts with near relatives of employees. As a result, the contract was
terminated and the government was reimbursed. Since then, the lab has put in place a
new process to help ensure compliance with policies for consulting agreements.”
In addition, the report noted that Beth Sellers did not notify LANL ethics officials or her superior of a potential conflict of interest involving William’s consulting agreement until five months after the consultant agreement was awarded.
The report further substantiated the allegations that:
• Work was performed before the consultant agreement was signed. “Specifically, we round that the consultant was paid $4,700 for services performed prior to the award of the consultant agreement.”
• William Sellers charged for work that was not performed. Specifically, the consultant charged two hours for a discussion on environmental matters that never took place.
The report said the two events were included in the initial $13,800 invoice submitted by the consultant to LANL. Before notifying the IG, the field office brought its attention to Los Alamos National Security LLC, which runs LANL.
LANS then determined that the consultant agreement did not confirm to prescribed LANL procedures and processes. The report said that LANL reimbursed the federal government $23,100, the total amount paid to William Sellers.
The first invoice totaled $13,800 and was dated Dec. 10, 2012 and the second invoice totaled $9,300 and was dated March 1, 2013.
Of the $13,800 included in the first invoice, $4,700 was for services performed before Sept. 11, 2012 award of the consultant agreement. The report said the $4,700 included 12 charges covering 4.7 days of work from Aug. 8 to Sept. 10, 2012.
The report detailed that the services included a charge of a two-hour meeting on Aug. 24, 2012 with a federal official in Española. However, the federal official told investigators that he was not in Española that day.
According to the report, the federal official said that he and his wife attended the Santa Fe Opera with the Sellers on that date, but the event was for relaxation and no business was discussed.
The federal official also told investigators that he was unaware that William Sellers had an agreement with LANL. The report said that when William Sellers was asked about the hours charged on Aug. 24, he agreed that hours charged probably should not have been billed.
After the allegations came to light, a review team was set up by LANS.
McMillan issued an email stating that when circumstances dictate, contracting for a named specialist, whether through consultant agreements, task order agreements, staff augmentation or otherwise, will be examined by a review team to prescreen requests before awarding a subcontract.
The review team was to be comprised of employees in oversight roles in Acquisition Services Management, LANL, Counsel and the Ethics and Audits Group.
The report also cited a number of contributing factors.
LANL officials who sponsored the consultant agreement failed to recognize and address apparent conflict of interest issues, and a LANL official signed the agreement requisitions, which did not provide required supplemental information.
Therefore, the official missed the fact that the consultant was a spouse to a senior LANL official.
In addition, the consultant and the senior LANL manager did not fully understand the requirements related to conflicts of interest.
During the LANL internal audit, according to the report, Bill Sellers indicated he thought the issue of conflict of interest only applied to organizations such as corporations, not individuals. Beth Sellers explained that she did not know she had to report the personal conflict of interest related to her spousal relationship until she was required to update her LANL form 1991.
William Sellers, meanwhile, told a LANL official that he believed he charged LANL for services performed after the agreement was signed but before it was actually rewarded.
However, both LANL and field office officials said that invoicing for services prior to award was inappropriate.