Sheffield CEO resigns, pleads guilty to violating Clean Water Act

New LondonThomas H. Faria, who resigned in March as president and chief executive officer of Sheffield Pharmaceuticals, pleaded guilty in U.S. District Court Tuesday to a felony violation of the Clean Water Act for knowingly discharging untreated industrial wastewater to the New London sewage treatment plant from 1986 to 2011.

Sheffield Pharmaceuticals’ factory at 170 Broad St. manufactures a wide range of over-the-counter pharmaceutical creams, ointments and toothpastes. The company employs about 200 people, according to its website.

Faria waived his right to indictment and pleaded guilty before U.S. District Judge Alvin W. Thompson. As a condition of his guilty plea, Faria, 37, of Waterford, resigned from the company on March 7, 2014, and can’t have a role in the operations or management of Faria Limited, according to U.S. Attorney Deidre M. Daly.

Faria’s father, owner of the Thomas G. Faria Corp., a gauge manufacturer in Uncasville, purchased the New London company in 1986. The father died in 2003.

Faria pleaded guilty to one count of knowingly violating, or causing to be violated, the Clean Water Act, an offense that carries a maximum penalty of three years of imprisonment and a fine of not less than $5,000 but not more than $50,000 per day of the violation. Judge Thompson has scheduled sentencing for Oct. 6.

Faria could not be reached to comment. Jeffrey Davis, a longtime employee who was named chief operating officer in February, issued a written statement Tuesday evening.

“We deeply regret the poor decision of Sheffield’s former CEO. We are remorseful about this past infraction,” Davis said in the statement. “Our company has been under new management and rectified the wastewater discharge in 2011. We are 1000% committed to obeying all environmental and legal regulations. As we continue to grow Sheffield, and its Connecticut workforce, our goal is to provide high-quality and ethical healthcare products that reduce suffering. To attain our goals, we must embody the highest standards of good corporate citizenship.”

The environmental impact of the violation over a 25-year-period is unknown, though Special Assistant U.S. Attorney Peter Kenyon from the Environmental Protection Agency said the EPA is unaware of any fish kills or direct harm suffered by humans.

“The possibility of impact from this type of discharge certainly exists,” Kenyon said during a conference call Tuesday. “In this case, we’re not making an argument that there are direct or substantial impacts that we can identify at this point years later.”

According to the government, Sheffield lacked a system to treat its industrial wastewater prior to discharge to the sewage treatment plant, performed no regular monitoring of its discharges of industrial wastewater, and submitted no monthly monitoring reports to the state Department of Energy and Environmental Protection. The treatment plant discharges to the Thames River.

According to the government, Faria, who became the company’s president and chief executive officer in April 2003, learned through his employees that Sheffield was discharging pollutants, including the toxic metal zinc, in its industrial wastewater without the required permit.

Faria’s employees, including a factory manager, urged him to make the financial investment to bring the company into compliance, but he chose not to do so even after four environmental consulting firms advised him that discharging industrial wastewater into the public sewage system is illegal, according to the government.

On April 20, 2011, the DEEP conducted an unannounced inspection of Sheffield, according to the government. After finding that the company had no wastewater discharge permits, the DEEP inspector issued a notice of violation and cited the company for discharging manufacturing and laboratory wastewater without a permit.

In 2011, Davis, then the company’s production manager, said the company was working with DEEP to obtain the necessary permits and comply with all regulations.

In May 2011, Sheffield submitted a permit application to DEEP so that the company could legally discharge industrial wastewater from its New London facility into the New London sewage treatment facility. By July 2011, the company had installed a wastewater pretreatment system.

Assistant U.S. Attorney Hal Chen said during the conference call that Sheffield spent approximately $200,000 in mitigation as part of the permit application it submitted in 2011. Chen is prosecuting the case with Kenyon.

Daly, the U.S. attorney, noting her office had secured two other convictions in environmental cases this year, said enforcement of environmental crimes is a priority in Connecticut, where her office partners with the EPA, U.S. Coast Guard, the Chief State’s Attorney’s Office, DEEP, and the Department of Public Health.

In April, Unilever Home & Personal Care, a manufacturer of personal care products, pleaded guilty to creating an illegal bypass at its Clinton facility that discharged wastewater into a storm drain leading to Hayden Creek. The company agreed to pay a $1 million fine and contribute $3.5 million to environmental programs. As a result of the prosecution, Unilever instituted a new environmental compliance program at all of its U.S. manufacturing facilities, Daly said.

In May, Singapore-based Odfjell Asia II PTE Ltd. and a senior crew member were sentenced for bypassing their tanker ship’s pollution prevention system and discharging oily bilge water directly into the sea, Daly said. The company was ordered to pay a criminal penalty of $1.2 million, including $300,000 to fund projects aimed at the preservation and restoration of Long Island Sound. The crewman who directed the illegal discharges was sentenced to three months in prison.

“The victims of these crimes are our natural resources — our creeks rivers and seas — but also the victims are our workers, customers, neighbors and the broader community,” Daly said. “The impacts are also economic, as violators avoid the true costs of doing business and thereby obtain an unfair advantage over their competitors.”

She said that lower-level employees, as in the Sheffield case, are often put in the difficult position of choosing between doing what is right and losing their jobs.

“Profits, promotions and bonuses create powerful incentives for managers to direct workers to cut corners or ignore environmental violations, sometimes at their own risk,” Daly said. “Criminal prosecution of responsible corporate officers and managers helps reduce those incentives while protecting employees.”

More than $18 million in community service payments and donations from environmental crimes in Connecticut has been used to preserve open space, restore watershed areas, repair infrastructure and prepare for climate change, according to Daly.

Daly said anyone with concerns about environmental crimes should contact the EPA at (617) 918-1111 or www.epa.gov.

k.florin@theday.com

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