Two years ago, Utah's former top radiation waste regulator filed an astonishing lawsuit demanding a promised "consulting fee" from Envirocare owner Khosrow B. Semnani.
Larry F. Anderson contended in his lawsuit that Semnani owed him $5 million beyond the $600,000 in cash, coins and real estate he had already received, a revelation that made them both targets of a federal criminal investigation.After prosecutors decided they were dealing with a case of extortion rather than bribery, Semnani was allowed to plead guilty to a misdemeanor tax charge in exchange for his unconditional cooperation in the continuing investigation of Anderson.
That investigation culminated Wednesday in a federal grand jury indictment accusing Anderson of "inducing" payoffs from Semnani "by the wrongful use and threatened use of economic harm and under color of official right."
The six-count indictment also charged Anderson with mail fraud, tax evasion and filing false tax returns. Anderson, 62, who now lives in Mesquite, Nev., could not be reached for comment, and his attorney declined to discuss the case.
In his capacity as director of the Bureau (and later, Division) of Radiation Control from 1980 to 1993, Anderson supervised the agencies that regulated the disposal of radioactive wastes in Utah. He came into contact with Semnani in 1987, when Envirocare filed an application for a license for a low-level radioactive waste dump in Tooele County.
According to the grand jury indictment, Anderson began extorting money and property from Semnani from about the time the Envirocare application was filed to early 1995. By then, Semnani had given Anderson $50,000 in cash plus gold coins, a Park City condominium and other goods worth an additional $550,000.
The indictment said the $50,000 was deposited into a secret Swiss bank account by an unnamed third party. Anderson failed to disclose the payment in his tax returns and falsely declared he had no signature authority over a foreign account, the indictment said.
"As a public officer and/or employee of the state of Utah, Anderson was obligated to provide the citizens of the state of Utah his honest services," the indictment said.
But from 1987 to 1995, "Anderson knowingly and willfully devised and intended to devise a scheme and artifice to defraud and deprive the citizens of Utah of their right to Anderson's honest services performed free of deceit, extortion, bias, self-enrichment and self-dealing."
The indictment said Anderson's purpose was to enrich himself by using his official position to obtain money and property from Semnani and then conceal his unauthorized activities from state officials.
In a statement issued Wednesday afternoon, Envirocare president Charles Judd said the charges confirm the position that Envirocare and Semnani have taken from the beginning: that Semnani was a victim of extortion.
Envirocare has also maintained throughout the scandal that the payments did not influence the regulatory approval of its facility. The company said its operations have been inspected and approved by the U.S. Department of Energy, Environmental Protection Agency, Nuclear Regulatory Commission and Utah Department of Environmental Quality.
Semnani, 51, pleaded guilty July 31 to a charge that he paid Anderson $40,000 in 1993 knowing that Anderson would not report it as income on his tax return. Under terms of the plea and cooperation agreement, he was fined $100,000 and agreed to testify against Anderson.
A summons was issued Thursday ordering Anderson to appear and answer the charges in U.S. District Court in Salt Lake City. If he is found guilty on all six counts, he could be sentenced to up to 37 years in prison and fined more than $3 million.