UNITED STATES NEWS

Two fired utility execs and a former top Ohio regulator plead not guilty in bribery scheme

Feb 13, 2024, 12:00 PM

Former FirstEnergy CEO Charles Jones, right, walks with his lawyer Carole Rendon toward the courtro...

Former FirstEnergy CEO Charles Jones, right, walks with his lawyer Carole Rendon toward the courtroom at the Summit County courthouse in Akron, Ohio, on Tuesday, Feb. 13, 2024. Two fired top executives of FirstEnergy Corp. and Ohio’s former top utility regulator have pleaded not guilty in connection with a $60 million bribery scheme. (AP Photo/David Dermer)
Credit: ASSOCIATED PRESS

(AP Photo/David Dermer)

COLUMBUS, Ohio (AP) — Two fired executives of FirstEnergy Corp. and a former top state utilities regulator pleaded not guilty Tuesday to state charges related to a $60 million bribery scheme that centered on securing a legislative bailout for two Ohio nuclear power plants with the help of a powerful House speaker.

Former FirstEnergy CEO Chuck Jones and Senior Vice President Michael Dowling forcefully pushed back after Republican Attorney General Dave Yost announced their indictments Monday, disputing fact patterns laid out in the state’s 50-page indictment and claiming a lack of evidence.

They and Sam Randazzo, a former chair of the Public Utilities Commission of Ohio who is also federally charged, were indicted by a Summit County grand jury Friday on a combined 27 criminal counts, including bribery, theft, engaging in a pattern of corrupt activity, tampering with records and money laundering.

The long-awaited indictments marked the latest development in what has been labeled the largest corruption case in Ohio history. Former House Speaker Larry Householder was convicted of racketeering last year and sentenced to 20 years in federal prison for masterminding the scheme. A lobbyist and former state Republican chairman, Matt Borges, got five years for his role. Both men have appealed.

Jones and Dowling, who were both fired in October 2020 for violating company policies and code of conduct, did not speak during Tuesday’s arraignment hearing before Summit County Common Pleas Judge Susan Baker Ross.

Randazzo also entered a not guilty plea in Baker Ross’s courtroom in Akron, as he did in December in federal court. He resigned in November 2020 after FBI agents searched his Columbus townhome and FirstEnergy revealed in security filings that it had paid him $4.3 million for his future help at the commission a month before Republican Gov. Mike DeWine nominated him as Ohio’s top utility regulator.

The judge set bond for all three men at $100,000 and ordered them to remain in Ohio under GPS monitoring. She denied the requests of Jones’ attorney, Carole Rendon, that her client be allowed to forego GPS monitoring due to a medical condition and to return to his primary residence in Naples, Florida.

In a statement issued by his lawyer Monday, Dowling said the $4.3 million paid to Randazzo was not a bribe, but represented the final annual installment from a 2015 settlement agreement between FirstEnergy and Industrial Energy Users-Ohio, a trade association of large commercial energy users represented by Randazzo. He said the decision to make those payments through the Sustainability Funding Alliance of Ohio, also controlled by Randazzo, was made by FirstEnergy’s legal and rates departments, not by Dowling himself.

The state pushed back Tuesday.

“This was not a $4.3 million coincidence,” said Principal Assistant Attorney General Matthew Meyer. Randazzo’s attorney, Richard Blake, also entered not guilty pleas Tuesday on behalf of both businesses. He noted that IEU-Ohio has since been dissolved.

Jones and Dowling are the seventh and eight individuals caught up in the web of investigations surrounding the scandal.

The U.S. attorney’s office in Cincinnati indicted Householder, Borges and three others on racketeering charges in July 2020. Lobbyist Juan Cespedes and Jeffrey Longstreth, a top Householder political strategist, pleaded guilty in October 2020 and await sentencing. The third person arrested, long- time Statehouse lobbyist Neil Clark, pleaded not guilty before dying by suicide in 2021. The dark money group used to funnel FirstEnergy money, Generation Now, also pleaded guilty to a racketeering charge in February 2021.

All were accused of using the $60 million in secretly funded FirstEnergy cash to get Householder’s chosen Republican candidates elected to the House in 2018 and then to help him get elected speaker. The money was then used to win passage of the tainted energy bill, House Bill 6, and to conduct what authorities have said was a $38 million dirty-tricks campaign to prevent a repeal referendum from reaching the ballot.

In July 2021, Yost asked a judge in Columbus to add Jones, Dowling and Randazzo to his office’s lawsuit against FirstEnergy.

An FBI criminal complaint from July 2020 detailed how executives of the Akron-based energy company interacted with Householder and others indicted in the scheme. It identified 84 phone contacts between Jones and Householder and 14 phone contacts between Dowling and Householder.

FirstEnergy admitted to its role in the bribery scheme as part of a July 2021 deferred prosecution agreement with the U.S. Department of Justice. The company agreed to pay $230 million in penalties and to accomplish a long list of reforms by July of this year in order to avoid being criminally prosecuted on a federal conspiracy charge.

A statement of facts signed by then-FirstEnergy CEO and President Steven Strah, who retired in 2022, detailed the involvement of Jones, Dowling, Randazzo and others in the bribery scheme. In a separate lawsuit involving Randazzo’s assets, his attorneys have called claims contained in the document mere “hearsay” designed to keep the energy giant out of legal hot water.

Ohio Consumers’ Counsel Maureen Willis called the latest indictments a step toward justice for the state’s utility ratepayers. But she said more is needed to undo the impacts of the tainted legislation that contained the nuclear bailout, known as House Bill 6, which has been only partially repealed.

“Ohioans continue to bear the cost of corruption — the H.B.6 coal plant subsidy — with a pricetag of half a million dollars a day,” she said in a statement. “Unless repealed, the cost to consumers is estimated to be $700 million by 2030. That must change. The coal subsidy should end now, not in 2030. And consumers should be refunded for every penny paid.”

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Two fired utility execs and a former top Ohio regulator plead not guilty in bribery scheme