Counterfeit parts ring is busted at 2 nuclear plants

Gori No. 3 reactor in Gijang County, Busan. By Song Bong-geun

ULSAN - Critical pieces of equipment at the Gori nuclear power plant are knockoffs made locally and bought by a supply manager at the plant who allegedly received kickbacks.

The components, high-end, low-pressure seal units for neutron detectors in the reactor, are still installed at the Gori No. 3 reactor. The originals were produced by the French company Areva, and they are crucial components to ensure the safety of the plant.

But the Korea Hydro and Nuclear Power Corporation said Wednesday there was no risk from the use of the knockoffs.

The Ulsan Prosecutors’ Office Wednesday said they arrested a senior official in charge of managing component suppliers at the Gori nuclear power facility, Korea’s oldest, on charges of taking bribes from the local supplier of the component.

Prosecutors said the official, surnamed Heo, 55, stole the original unit in 2009 along with its blueprints and gave them to a local manufacturer.

The manufacturer copied the unit and supplied units to Heo in May 2010, officially signing a new contract with the headquarters as a supplier. In return, Heo allegedly received 800 million won as a kickback, prosecutors said. There are 50 knockoffs installed in Gori.

Prosecutors also arrested another senior manager, surnamed Mun, who also allegedly received money from the supplier.

Prosecutors traced Heo’s bank account and found that he received money from other suppliers, raising suspicions that he gave stolen components to them as well.

The Ulsan prosecutors found that another nuclear plant in Yeonggwang, South Jeolla, also had knockoffs based on the original made by Areva. The plant’s manager contracted a local manufacturer to copy the components.

The manager was allegedly given 100 million won in return for using copied units. A go-between who introduced the supplier to the manager allegedly received 500 million won. Both were arrested.

The go-between in the Yeonggwang plant transaction was also involved in the Gori case, allegedly giving 50 million won to Heo, prosecutors said.

Prosecutors said yesterday they have arrested a total of five officials involved in the scam at the Gori and Yeonggwang plants and they found at least 1 billion won in each person’s bank account.

The government-run Korea Hydro and Nuclear Power Corporation said Wednesday there was no risk in using copied components.

“Although the unit is a copied version of a foreign product, the local manufacturer acquired patent rights, which means their product is original,” a corporation official told local media Wednesday.

Outside experts disagree.

“It is necessary to use original components because even a tiny alteration could have an impact on safety,” a nuclear plant safety expert told the JoongAng Ilbo on the condition of anonymity. “They [the Gori plant managers] should form a department to monitor supplies of all components.”

This is not the first time that the Gori plant’s managers have been caught doing business on the side. A 46-year-old manager surnamed Shin gave discarded, rusted turbine valve actuators to a Busan-based supplier on several occasions between 2008 and 2010. The supplier cleaned seven of the actuators and sold them back to Shin. Shin allegedly received a total of 3.2 billion won in kickbacks and was sentenced to three years in prison.

“We suspect more suppliers and managers are involved in the cases,” said Gu Bon-jin, a senior prosecutor in Ulsan.

By Kim Yun-ho, Kim Hee-jin [heejin@joongang.co.kr]