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Government Actions
FirstEnergy charged federally, agrees to terms of deferred prosecution settlement
On July 22, 2021, FirstEnergy Corp. signed a deferred prosecution agreement with the Department of Justice, U.S. Attorney's Office, Southern District of Ohio that could potentially result in dismissal of the charge of conspiring to commit honest services wire fraud. FirstEnergy Corp. has agreed to pay a $230 million monetary penalty.
FirstEnergy Corp. admits it conspired with public officials and other individuals and entities to pay millions of dollars to public officials in exchange for specific official action for FirstEnergy Corp.’s benefit. FirstEnergy Corp. acknowledged in the deferred prosecution agreement that it paid millions of dollars to an elected state public official through the official’s alleged 501(c)(4) in return for the official pursuing nuclear legislation for FirstEnergy Corp.’s benefit. The company also acknowledged that it used 501(c)(4) entities, including one it controlled, to further the scheme because it allowed certain FirstEnergy Corp. executives and co-conspirators to conceal from the public the nature, source and control of payments. FirstEnergy Corp. further acknowledged that it paid $4.3 million dollars to a second public official. In return, the individual acted in their official capacity to further First Energy Corp.’s interests related to passage of nuclear legislation and other company priorities.
FirstEnergy Corp. has cooperated substantially with the government, and according to the deferred prosecution agreement, the company must continue to cooperate fully with the United States in all matters related to the company’s conduct described in the agreement and other conduct under investigation by the government, among other obligations. For example, within 60 days of 7/22/2021, FirstEnergy Corp. must pay $115 million to the United States and $115 million to the Ohio Development Service Agency’s Percentage of Income Payment Plus Plan, a program that provides assistance to Ohioans in paying their regulated utility bills.
Other terms in the agreement include publicly disclosing on its website any FirstEnergy Corp. contributions to 501(c)(4) entities and entities known by FirstEnergy Corp. to be operating for the benefit of a public official, either directly or indirectly, and making various provisions to improve corporate compliance moving forward.
As part of the agreement, FirstEnergy Corp. admitted to the facts alleged in the Information and outlined in the Statement of Facts, which detail actions by FirstEnergy Corp. executives to pay money to public officials in return for official action. As a corporation, FirstEnergy Corp. is responsible for the acts of its current and former officers, directors, employees and agents.
For more information, consumers can contact the Dept. of Justice, U.S. Attorney's Office, Southern District of Ohio or review its media release.
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Pending Government Action
The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the government’s allegations, which have not yet been proven.
On September 23, 2020, the State of Ohio ex rel. Dave Yost, Ohio Attorney General, filed case No. 20 CV 006281, in the Court of Common Pleas, Franklin County, Ohio. The Primary Action sets out a corrupt enterprise claim under Ohio Revised Code §2923.32 and §2923.34 alleging major utility players and various political actors acted in concert to create Ohio House Bill 6, which includes a monthly charge to every ratepayer called a "nuclear generation fee." The case was amended August 5, 2021 to include additional charges of Civil damages for criminal acts (OCR 2307.60) and d.amages for reputable harm (ORC 2307.60 and 2923.34)
The defendants named in the case are: FirstEnergy Corp.; FirstEnergy Service Company; FirstEnergy Solutions Corp.; Energy Harbor Corp.; Larry Householder; Friends of Larry Householder; Generation Now, Inc.; Jeff Longstreth; JPL & Associates LLC; Constant Content Co.; Neil Clark; Matt Borges; 17 Consulting Group LLC; Juan Cespedes; the former CEO, Charles Jones; the former Vice President, Michael Dowling; former Public Utility Commission of Ohio Chairman, Sam Randazzo; along with several entities assoicated with Randazzo.
Some of the requests made of the court by Ohio Attorney General are: that the court revoke/nullify any application filed by any defendant to the Ohio Air Quality Development Authority; prevent parties from receiving monetary benefit, supplement, credit or offset through H.B. 6 of the 133rd Ohio General Assembly; each defendant entity and nonprofit be dissolved or reorganized to remove those involved; defendants be enjoined from engaging in all lobbying activities for eight years; and defendants ordered to pay damages. It also seeks recovery from Randazzo of a $4.3 million bribe FirstEnergy admitted it paid to Randazzo to help construct House Bill 6 while serving as FirstEnergy's regulator.
The matter is pending. For more details, consumers can read the court document or contact the Franklin County Clerk of Courts.
Service Area
- CUYAHOGA County, OH
- GEAUGA County, OH
- LAKE County, OH
- PORTAGE County, OH
- STARK County, OH
- SUMMIT County, OH
- TRUMBULL County, OH
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