Potosi, MO – Dale Johansen, a former Missouri Public Service Commission employee and owner of Johansen Consulting Services LLC, was sentenced on January 29, 2019, after pleading guilty to a federal fraud charge stemming from his mismanagement of the Rogue Creek Utilities, Inc. water system. The case, investigated by the Environmental Protection Agency’s Criminal Investigation Division, revealed a deliberate attempt to conceal the prolonged failure of a critical lead reduction system, endangering the health of residents in the Potosi vacation community.
Johansen, who served as Superintendent of the Water and Sewer Department for the Missouri Public Service Commission for twelve years, transitioned to private consulting in 2011. In 2012, he became the receiver for Rogue Creek Utilities, taking full responsibility for the community’s drinking water and sewer services, including regular sampling and maintenance. This placed him in a position of trust, responsible for ensuring the safety of the water supply for approximately 90 households.
The deception came to light in March 2016 when local officials discovered the water softener system, designed to remove lead from the well water, had been inoperable for an extended period. While residents were initially subjected to untreated water, restoration of the system did not resolve the issue. Subsequent testing revealed dangerously high levels of lead in the drinking water, prompting the Missouri Department of Natural Resources to issue a “DO NOT DRINK” order that remained in effect until May 2017. This order forced residents to rely on alternative water sources, creating significant hardship and raising serious health concerns.
The EPA investigation revealed Johansen knowingly misrepresented the duration of the system’s failure to investigators. He falsely claimed the system had been offline for only six to eight weeks, when, in reality, it had been non-operational for nearly six months. This deliberate misstatement was intended to downplay the severity of the situation and avoid potential regulatory scrutiny. Investigators believe the prolonged lack of proper filtration led to elevated lead levels in the water consumed by Rogue Creek residents.
Legal Ramifications
Johansen was found to have violated Title 18 U.S. Criminal Code, specifically 18 U.S.C. 1001, which prohibits knowingly making false statements to federal investigators. As a result of his guilty plea, he was sentenced to pay a $7,500 fine, complete a three-year term of probation, and perform 100 hours of community service. The sentencing reflects the seriousness with which federal authorities view attempts to obstruct environmental investigations and endanger public health.
Key Facts
- Defendant: Dale Johansen
- Location: Rogue Creek Utilities, Potosi, Missouri
- Crime: Fraudulent misrepresentation to environmental officials regarding a failed water lead reduction system.
- Duration of Mismanagement: System offline for approximately six months, falsely reported as six to eight weeks.
- Impact: “DO NOT DRINK” order issued for Rogue Creek residents from March 2016 to May 2017.
- Statute Violated: 18 U.S.C. 1001
- Penalty: $7,500 fine, 3 years probation, 100 hours community service.
The case serves as a stark reminder of the critical importance of responsible management of public water systems and the potential consequences of prioritizing profit or convenience over the health and safety of communities. The EPA continues to prioritize the investigation and prosecution of individuals who attempt to circumvent environmental regulations and endanger the public.
Source: EPA ECHO Enforcement Case Database
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