Guilty Plea for Woman Who Concealed Steamboat Asbestos

A San Francisco woman faces up to two years in prison and hundreds of thousands of dollars in fines after pleading guilty to a federal charge that she didn’t tell Louisiana regulators about asbestos in the Mississippi Queen steamboat before it was demolished.

Chiu’s company, Cheery Way Inc., faces up to five years’ probation and large fines.

Chiu and Cheery Way agreed to plead guilty Wednesday to Clean Air Act violations after waiving indictment. Prosecutors filed evidence showing Chiu and Cheery Way knew the board contained asbestos but didn’t tell a Pierre Part demolition contractor. Sentencing for Chiu and Cheery Way is set for May 18.

Removal of asbestos is heavily regulated, in large part because exposure to asbestos fibers can cause respiratory problems and rare cancers.

The 376-foot Mississippi Queen began plying the Mississippi River system in 1976. Once owned by the Delta Queen Steamboat Co. before its parent company’s bankruptcy in 2001, the ship was bought by another company but taken out of service in 2007 with intentions to renovate it. When that didn’t work out, the ship was sold for scrap to a California company owned by Chiu for $800,000 in October 2010, according to evidence prosecutors introduced in court.

But The New Orleans Advocate reports that plan resulted in a state Department of Environmental Quality probe in May 2011 after an anonymous tip about possible asbestos-related work on the steamboat happening at Argosy Boat Co. in Pierre Part.

Cheery Way had a company conduct tests and found asbestos in the ship’s walls and ceiling, according to the court documents, but didn’t tell regulators or Argosy Boat.

Prosecutors said the contractor, who they did not name but DEQ records show was Argosy Boat, had no prior asbestos abatement experience and was not a certified asbestos abatement contractor. Workers started demolition without being required to take safety precautions.

Dave Reidt, owner of the now shuttered Argosy Boat, said the incident was his company’s first job and cost him everything he had. He claimed prosecutors cleared him of criminal wrongdoing.

Anna Christman, a spokeswoman for the U.S. Attorney’s Office in New Orleans, would not directly comment on Reidt’s claim but noted that only Chiu and Cheery Way were named in the bill of information Dec. 4 bringing charges over the incident.

Tim Beckstrom, DEQ spokesman, said the Mississippi Queen was sold for scrap. The company Chiu used to buy the steamboat paid $245,248 to remediate the demolition site in Pierre Part, prosecutors said.