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Signal Peak coal mine near Roundup agrees to $1M plea deal for federal violations

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Posted at 4:04 PM, Oct 07, 2021

The owners of an underground coal mine near Roundup admitted Thursday in federal court to criminal charges of illegally disposing of mine waste and covering up employee injuries, according to Acting U.S. Attorney Leif M. Johnson.

Signal Peak Energy agreed as part of a proposed plea deal to pay a $1 million fine, or the maximum of $250,000 for each misdemeanor charge.

Federal prosecutors alleged in court documents that senior mine managers at Signal Peak directed employees to regularly violate health and safety standards outlined in the Mine Safety and Health Act from 2013 to 2018.

In the summer of 2013, mine managers directed employees to illegally pump mine waste, known as slurry, into abandoned sections of the mine, according to prosecutors. Slurry contains wastewater, industrial chemicals and unprocessed soil containing heavy metals, including arsenic and lead over groundwater tolerances.

After a section was full, mine managers directed employees to drill two bore holes into the ground to dispose of more mine waste. The pumping occurred
for about six weeks until a seal breached, flooding waste into the mine itself, prosecutors said.

In 2018, mine managers encouraged, and even outright bribed, employees to lie about on-the-job injuries, according to prosecutors.

In the first case, an employee's finger was crushed moving mining equipment, requiring amputation. A safety manager drove him to the hospital, and the mine's vice president of operations called him and urged him to not report the injury as work-related. The employee then stated the injury happened at home, and the vice president gave him an envelope with $2,000, according to prosecutors.

A second employee was struck by falling rock and suffered a severe cut on his head. The safety manager was called, and instead of taking him to the hospital, took him home. The employee waited until the next day to go the hospital and said the injury happened at home. He returned to work and was unable to complete several shifts because of his injury. His lost time was charged against vacation leave without his approval, according to prosecutors.

These most recent charges were uncovered as part of a broader investigation into corruption at Signal Peak, centered around one executive's scheme to pay for construction of Billings' largest mansion.

Individual convictions of former mine officials included Larry Wayne Price, Jr., former vice president of surface operations, who was sentenced to prison for defrauding companies of $20 million to build the large home; and Zachary Ruble, former surface mine manager, who was sentenced to probation for conspiring to defraud Signal Peak Energy of $2.3 million.

A third former mine official, Dale Lee Musgrave, former vice president of underground operations, has pleaded not guilty to an indictment alleging cocaine trafficking and false statements in mine records and is pending trial.

Associated individual cases include Stephen P. Casher, a former Rocky Mountain Bank loan officer, who was sentenced to prison and fined on bank fraud and money laundering charges for a loan scheme involving Larry Price Jr.; James and Timilynn Kisling, owners of Kisling Quality Builders, who were sentenced to probation and fined for conviction of tax evasion in a scheme involving the construction of Larry Price Jr.’s Billings residence; Mark Luciano, a Nevada resident who was sentenced to prison for conviction on trafficking cocaine; and Todd Alan Irwin, a secretary to Larry Price, Jr., who was sentenced to probation for conviction of felon in possession of firearms.

Robert Wayne Ramsey, owner of Peters Equipment Company, has been charged with wire fraud in an alleged equipment sale scheme involving Signal Peak Energy and is pending arraignment.