Regulators block deposition of former FirstEnergy ethics chief


A state regulator has granted a request by FirstEnergy Corp., allegedly made at the request of federal prosecutors investigating the company’s lobbying practices, to halt a deposition by a state watchdog agency. former senior corporate ethics officer last week.

The Akron-based utility company last summer admitted to bribe two state officials with approximately $64 million in exchange for favorable legislative and regulatory treatment. FirstEnergy is now cooperating with the US Department of Justice’s criminal investigation of former GOP Chairman Larry Householder and suspected conspirators.

The householder has pleaded not guilty and is awaiting trial early next year.

State and federal regulators, meanwhile, have conducted their own parallel investigations. An administrative judge for the Public Utilities Commission of Ohio, whose former chairman was accused by FirstEnergy of accepting his $4.3 million bribe, granted the company’s request to end the interview on July 21.

During the deposition, the Ohio Consumers’ Counsel — a state agency that represents the interests of ratepayers in electrical matters — questioned former FirstEnergy ethics officer Ebony Yeboah-Amankwah. . The questions related to the actions of former PUCO Chairman Sam Randazzo, an entity he allegedly used to receive the FirstEnergy bribe, the legislation behind the lawsuits, and the dismissal of the former CEO. of the society.

Following the scandal, Yeboah-Amankwah and two other executives were “parted from FirstEnergy due to inaction and conduct which the board said was influenced by inappropriate tone at the top,” the company said. said in October 2020. Documents filed in a related case show invoices addressed to Yeboah-Amankwah from Randazzo’s company.

According to statements by a FirstEnergy attorney to a PUCO judge, the OCC’s questions were at the heart of the ongoing prosecutions and investigations by the US Attorney’s office. After suspending the deposition, he said he called Emily Glatfelter, an assistant US attorney leading the prosecution, who allegedly objected to the line of questioning.

“I would just say that no one is trying to prevent consumers from accessing this information and these witnesses,” said Adam Hollingsworth, an attorney representing FirstEnergy, according to a transcript of the hearing.

“It’s just a matter of timing, and the US Attorney’s office has advised us that the timing of these questions will materially impact their investigation.”

Other parties involved in the deposition took issue with FirstEnergy’s efforts on several counts. On the one hand, they argued that their questions were aligned with the investigation into FirstEnergy’s alleged corporate separation violations. For two, they wondered why PUCO should take FirstEnergy’s word for an alleged conversation with a prosecutor that no one else was a party to.

“I also think it was inappropriate for the attorney for FirstEnergy Corporation to call the DOJ office without all of us on the phone,” said Kim Bojko, an attorney representing the Ohio Manufacturers Association, a party to the deposition. “We think it was totally inappropriate to hear one side of the story, and him characterizing the issues the way he did.”

Bojko said payments to Randazzo could apply directly to ongoing corporate separation issues.

Judge PUCO ruled that the OCC and others cannot ask further questions about nonpublic information related to the Deferred Prosecution Agreement FirstEnergy entered into with the US Department of Justice. However, as a sort of compromise, she agreed to release the transcript of the hearing.

A PUCO spokesperson declined to answer when asked if the agency had contacted prosecutors to verify FirstEnergy’s claim.

Jennifer Thornton, spokeswoman for the U.S. Attorney for the Southern District of Ohio, also declined to respond. She said FirstEnergy is obligated to cooperate fully with the bureau.

“We want to make it clear that our goal is always not only to protect the public, but also to keep them informed,” she said. “After all, FirstEnergy’s alleged unlawful conduct was discovered by us and then the details were made public through the Statement of Facts in our [deferred prosecution agreement]. We understand that PUCO’s orders establish a policy of non-interference in matters that overlap with our criminal investigations and prosecutions. Accordingly, we believe the information will become public in due course.

Months after Householder’s 2020 arrest, PUCO opted against a centralized investigation into FirstEnergy’s conduct. Instead, he took a more Byzantine approach of four interrelated investigations. This decision was made when the PUCO was under Randazzo’s control.

FirstEnergy admitted in the deferred prosecution agreement that it paid Randazzo a $4.3 million bribe. He resigned after FBI agents raided his home. However, he maintained his innocence and was not charged with a crime.

The investigation in question focuses on whether FirstEnergy violated Ohio law. company separation lawsthat require companies to distinguish and separately account for their regulated utility activities with various unregulated affiliates.

A PUCO order Audit published last year identified several shortcomings in FirstEnergy’s corporate separation practices. However, this audit was limited by the fact that the investigators “could not access the files of the compliance officer in place during the audit period (2016 to 2020) since this person had been separated from the company before the start of the audit.”

This prompted the OCC to request that the PUCO subpoena Yeboah-Amankwah. Yeboah-Amankwah herself and FirstEnergy unsuccessfully sought to quash the subpoena.

A lawyer for Yeboah-Amankwah did not respond to inquiries.

On Tuesday, the OCC filed an appeal with PUCO, warning that its order last week, if not clarified, could essentially “shut down” the deposition.

“Ohio consumers should not be sacrificed because FirstEnergy Corp. has been charged with a crime,” the OCC attorneys wrote. “PUCO has a legal duty to protect Ohio consumers from illegal and unreasonable electric rates. PUCO’s Response to FirstEnergy Corp.’s Interference and to his attempt to thwart the deposition should be “no”.

A spokeswoman for the OCC did not respond when asked if the agency had contacted the US Attorney’s office about the matter.

The PUCO has yet to rule on the OCC’s appeal.

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