Shell companies purchase radioactive materials, prompting push for nuclear licensing reform

Staff Sgt. Christopher Muncy
·3 min read

WASHINGTON – Late last year, government employees forged a copy of a license to buy hazardous, radioactive material. They created shell companies, then placed orders, generated invoices and paid two U.S.-based vendors.

The scheme worked. The employees successfully had the material shipped, complete with radioactive stickers on the side, then confirmed delivery.

But the workers were actually investigators from the Government Accountability Office, the congressional watchdog, and they were testing the Nuclear Regulatory Commission’s ability to regulate the sale and procurement of dangerous materials.

The act, and a subsequent report from the GAO, alarmed Rep. Ritchie Torres, D-N.Y., who is now calling on the Nuclear Regulatory Commission to overhaul its licensing system as a way to avoid a national security disaster.

“Anyone could open a shell company with a fraudulent license to obtain dangerous amounts of radioactive material that could be weaponized into a dirty bomb,” Torres told Defense News in an interview on Wednesday. “Disperse radioactive material in a city as densely populated as New York, and it could cause catastrophic damage.”

The commission classifies radioactive material into five categories of risk. Only categories one and two currently are subject to its independent license verification system – a loophole that Torres and the GAO fear that an individual or group could exploit to wreak havoc by building a dirty bomb that combines combines conventional explosives with category three radioactive materials.

Torres, who sits on the House Homeland Security Committee, is pressing the NRC to immediately expand its independent license verification system to include category three quantities of radioactive materials. He formally made the licensing overhaul request in a letter seen by Defense News on Wednesday. This request is in line with the GAO’s recommendations in what Torres called an “alarming report.”

The report notes that the watchdog “provided a copy of a license that GAO forged to two vendors, subsequently obtained invoices and paid the vendors.” It notes that the GAO did not accept the shipment at the delivery point and instead “safely and securely” returned the radioactive material to the vendors.

“While radioactive materials have legitimate medical and industrial uses, the illicit possession, purchase and use of radioactive materials poses an extreme threat to homeland security,” Torres wrote in his letter. “Without additional security protocols, including a more rigorous system of independent license verification, a terrorist could exploit current vulnerabilities to obtain radioactive material and weaponize it into a dirty bomb against a soft target in America’s largest cities.”

The GAO report notes that a malicious actor could use category three materials to build a dirty bomb. For instance, it says that someone “might be able to obtain a category 2 quantity by purchasing and aggregating more than one category 3 quantity from multiple vendors.”

Torres also wrote in his letter that the NRC should “assess the need for independent license verification for category four and five radioactive materials,” which goes beyond the scope of the GAO recommendations.

Category three materials are frequently used in fixed radiation gauges to measure things like moisture and density in soil and asphalt for industries ranging from mining to oil and gas to agriculture. The lowest-tiered categories of radioactive materials are often used in devices such as Xray machines.

David McIntyre, a NRC spokesman, told Defense News that the agency is “taking actions to address the issues identified by the GAO.”

“Upon release of the report, we immediately contacted manufacturers of these radioactive sources to ensure they are vigilant with sales, especially for new customers or unusual activities,” said McIntyre.

McIntyre noted the NRC is “expediting a rule change already in progress” that would include “consideration of multi-factor authentication” for category three radioactive materials.

“In contrast, imposing immediate additional security requirements would risk unintended impacts to important and safe medical, academic and industrial uses of these materials,” he added.

The GAO report acknowledged that “NRC is taking some steps to strengthen its licensing program” but cautioned that “current gaps will remain unaddressed until at least the end of 2023.”