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FirstEnergy will pay $100M in a HB 6 settlement with the SEC; ex-CEO will face civil fraud charges

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COLUMBUS, Ohio (Statehouse News Bureau) — FirstEnergy has agreed to pay a $100 million fine to settle civil fraud charges filed by the Securities and Exchange Commission related to the House Bill 6 nuclear power plant bailout. But the utility’s former top executive will still face charges from the SEC.

Chuck Jones, FirstEnergy Corp CEO, after testifying before a Senate committee in May 2017.
Chuck Jones, FirstEnergy Corp CEO, after testifying before a Senate committee in May 2017. [Andy Chow | Statehouse News Bureau]
The SEC is accusing former FirstEnergy CEO Chuck Jones of misleading investors after Republican former House Speaker Larry Householder was arrested in the $60 million bribery case in 2020. A year later, FirstEnergy admitted to bribing the now-convicted and imprisoned Householder and the late public utilities commission chair Sam Randazzo to get the billion-dollar nuclear power plant bailout passed in 2019. In that deferred plea agreement, the utility agreed to pay a $230 million fine.

The SEC complaint filed in federal court says Jones told the public that “FirstEnergy acted ethically in this matter” and “transparently.” The complaint also alleges Jones misled the company’s auditor and helped with misrepresentations FirstEnergy made in an SEC filing.

Jones pleaded not guilty to state corruption charges in February, along with former FirstEnergy senior vice president Michael Dowling. The two were fired by the company in October 2020. Randazzo was charged at the same time as the former executives and had also pleaded not guilty to federal charges. He died by suicide in April.

The SEC fine is significantly higher than FirstEnergy’s $20 million settlement with state prosecutors led by Republican Attorney General Dave Yost a month ago. That deal spared the company from facing any state criminal charges in the case. Democratic state lawmakers have blasted that settlement as “stunning” and “unacceptable”.

FirstEnergy issued a statement from president and CEO Brian X. Tierney: “We are pleased to have reached a resolution with the SEC as we continue to turn a new chapter. Our focus today is investing in our regulated electric companies to improve the customer experience and support the energy transition.”