A federal grand jury has indicted former Public Utilities Commission of Ohio chairman Samuel Randazzo on bribery and fraud charges.
FirstEnergy is not named in the indictment, which was unsealed today, but the utility company previously admitted it paid Randazzo the $4.3 million bribe attributed to “Company A” in the charging document. Randazzo resigned from PUCO in 2020, after the FBI raided his home.
Prosecutors used pseudonyms to describe multiple individuals and entities who are left unnamed in the indictment, but who can be identified based on previous reporting and evidence made public in state and federal investigations connected to the case.
Executive 1 is former FirstEnergy CEO Charles E. Jones and Executive 2 is former FirstEnergy lobbyist Michael Dowling. Jones and Dowling were fired by FirstEnergy in 2020, in response to the federal criminal investigation that became public that summer with the arrest of ex-Ohio House Speaker Larry Householder.
A jury convicted Householder earlier this year for racketeering in a $60 million bribes-for-bailouts scheme that also involved FirstEnergy, but Jones and Dowling have not been charged. FirstEnergy agreed to pay a $230 million fine as part of a deferred prosecution agreement.
State Official 1 is Ohio Governor Mike DeWine and State Official 2 is Lt. Governor Jon Husted.
The indictment describes how media reports, including one by the Energy and Policy Institute, began to reveal the once-secret money trail between FirstEnergy and Randazzo’s consulting firms just days before DeWine appointed Randazzo as PUCO chairman in early 2019:
Industry Group 1 is Industrial Energy-User Ohio (IEU-Ohio), an industry association that Randazzo helped found during the 1990s and then represented as an attorney and lobbyist prior to his appointment as PUCO chairman.
Prosecutors allege that between 2010 and 2019, Randazzo schemed to “enrich himself by defrauding Industry Group 1 and its members out of money and property by means of materially false and fraudulent pretenses, representations, and promises.”
According to the indictment:
a. It was part of the scheme that the defendant, SAMUEL RANDAZZO, controlled Industry Group 1 bank accounts and Industry Group 1 bank account statements were sent to either his home or office.
b. It was part of the scheme that the defendant, SAMUEL RANDAZZO, entered into agreements and arrangements on behalf of Industry Group 1 and its members, which resulted in companies making payments (“settlement payments”) to Industry Group 1 and its members.
c. It was part of the scheme that the defendant, SAMUEL RANDAZZO, kept money intended for Industry Group 1 and its members for himself…
Randazzo represented IEU-Ohio and its members in multiple cases before the PUCO between 2010 and 2019. The indictment doesn’t identify which utility “companies” were parties to the agreements involved in Randazzo’s embezzlement scheme, but the outcomes of those settlements would have also had broader implications for other ratepayers of those utilities.
FirstEnergy previously admitted that it paid Randazzo a total of $22 million between 2010 and 2019.
PUCO already plans to investigate one undisclosed side deal between FirstEnergy and Randazzo that involved IEU-Ohio and was flagged earlier by prosecutors.
In 2015, AEP quietly paid $8 million for IEU-Ohio to drop its opposition to a proposed ratepayer bailout for the Ohio Valley Electric Corporation coal plants, as Columbus Business First reported at the time.
