23 Jul 2021
AP — The energy giant at the center of a $60 million bribery scheme in Ohio admitted Thursday to using dark money groups to fund the effort, and agreed to pay $230 million and other conditions so prosecutors won’t forge ahead with a criminal case against the company.
Authorities charged Akron-based FirstEnergy Corp. with conspiracy to commit wire fraud, alleging payoffs to public officials to back a $1 billion subsidy that would have had taxpayers helping the company prop up two aging nuclear plants.
That charge could be dropped in three years if the company complies with the terms of the deal, such as continuing to cooperate with investigators looking into the kickbacks to officials, who included the Ohio House speaker and a lobbyist who would become the state’s top utility regulator.
The deal, signed off by FirstEnergy’s president and CEO, comes in a scandal that has affected business and politics across Ohio since the arrests a year ago of then-Ohio House Speaker Larry Householder and four associates. Government officials say Householder orchestrated a plan to accept corporate money for personal and political use in exchange for passing nuclear bailout legislation and scuttling an effort to repeal the bill.
“I hope that today’s announcement serves as a stern warning to other corporations and corporate executives who would sell their integrity to a public official, a group of public officials,” said FBI Special Agent in Charge Chris Hoffman, calling the probe a historic public corruption investigation that “deserves historic remedies.”
Acting U.S. Attorney Vipal J. Patel called the $230 million penalty probably the largest ever secured by his office.
FirstEnergy is one of the largest investor-owned electric systems in the nation with an annual revenue last year of $10.8 billion. Patel rejected suggestions that the sum was too lenient.
“So the principal here is try and come up with a number that stings, okay, but doesn’t annihilate,” Patel said, asserting that decimating the company’s finances would hurt employees and customers and diminish FirstEnergy’s incentive to cooperate.
Half of the $230 million penalty will go to the federal government and the other half will be paid to a program that benefits Ohio’s regulated utility customers, Patel said. FirstEnergy also has to forfeit about $6 million seized from the accounts of one of the dark money groups, Partners for Progress.
Under the agreement, FirstEnergy also must make public any new corporate payments it’s aware of that were intended to influence a public official and continue an internal makeover of its ethics practices. It also must issue a public statement describing that it intentionally used dark money groups to hide the scheme.
Prosecutors say the company used the groups “as a mechanism to conceal payments for the benefit of public officials and in return for official action.”
By Mark Gillispie, Julie Carr Smyth and Farnoush Amiri, Associated Press, 22 July 2021
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