Ohio Attorney General Dave Yost has agreed to settle the largest bribery and money laundering scandal in the state’s history with the energy giant that financed it.
At just $20 million, the settlement amount is less than a third of the bribes paid by Akron-based FirstEnergy, and it is hard to beat the benefits the utility received from Ohioans as a result of the corrupt legislation that was funded with those bribes.
Yost’s office sends frequent press releases, but not regarding Monday’s agreement, which was first discussed by the Cincinnati Enquirerciting an SEC filing from FirstEnergy.
When asked, his office said Yost “voluntarily removed himself from the case months ago to avoid any appearance that the case was politically motivated or that the outcome was influenced by politics or political decisions.” But it did not explain how.
The statement comes after more than a year of questions about the attorney general’s involvement in the fight to pass and secure the $1.3 billion consumer bailout package, most of which went to FirstEnergy.
Yost’s office added that the company was cooperating with the state’s prosecution of two former executives and that it had reformed in the years since the scandal.
“The non-prosecution agreement signed between FirstEnergy, the Ohio Attorney General’s Office and the Summit County District Attorney’s Office requires FirstEnergy to provide evidence, access to witnesses and testimony in the ongoing criminal proceedings against (former CEO) Chuck Jones and (former Vice President) Michael Dowling, as well as in the civil proceedings related to the passage” of the corrupt bailout package, spokesman Steve Irwin said in an email.
By agreeing to the pact, FirstEnergy will not be prosecuted. The company paid the federal government 230 million US dollars in 2021 to have the criminal charges dropped in this case.
By dropping the lawsuits, FirstEnergy and the federal government avoided a major financial hit. Consultants told the company it could nearly $4 billion in fines if charges are filed, the Cleveland Plain Dealer reported Tuesday.
According to weeks of testimony in federal court in Cincinnati last year, FirstEnergy executives began courting Larry Householder and other state politicians in late 2016. The executives had bet heavily on loss-making coal and nuclear power because they had failed to anticipate that the fracking boom would make gas-fired power cheaper.
Therefore, the executives – CEO Jones and Vice President Dowling – began frantically searching for a rescue operation.
They poured $61 million of corporate funds into 501(c)(4) dark money groups. From there, the money flowed into the election of friendly Republicans who would make Householder Speaker of the Ohio House of Representatives in early 2019.
From this position, Householder oversaw the corrupt bailout package, House Bill 6.
Sam Randazzo, who was chosen by Governor Mike DeWine to chair the Public Utilities Commission, helped write and lobby for the bailout package, even though he was supposed to be a neutral regulator. FirstEnergy later said it paid Randazzo a $4.3 million bribe, which committed suicide in April.
DeWine, whose administration included several high-ranking officials with ties to FirstEnergy, signed the bill the same day it passed, but it immediately faced opposition in the form of a fierce campaign to repeal the bailout.
FirstEnergy executives – now facing federal charges – were so alarmed by the repeal effort that they raised $36 million to stop it. The resulting campaign included false, xenophobic television advertising, intimidation of people collecting signatures to repeal the law, and even accusations of assault.
Yost provided great assistance to HB 6 supporters in the heat of the repeal battle.
Before a repeal could be put on the ballot, supporters had to collect 1,000 valid signatures from registered voters and submit a ballot summary to the attorney general. Yost had to approve this before repeal supporters could begin collecting the required 265,000 additional voter signatures. And they had just 90 days to do so after DeWine signed the corrupt bailout package on July 23, 2019.
The summary and 1,000 signatures were submitted within 10 days. But then Yost rejected the ballot wording on the first pass. By the time they submitted different wording and more signatures—and Yost approved it—their time to collect more than a quarter of a million signatures had been cut by 40%, and the Repeal failed.
While Yost – a candidate for governor in 2026 – did not comment on his behavior during this time, some of the conspirators did.
During the trial last year, federal prosecutors presented messages between former Ohio Republican Party chairman Matt Borges, who is serving a five-year prison sentence for his involvement, and Juan Cespedes, who pleaded guilty to the case.
In one of those cases, Borges said the attorney general told him he thought the bailout was bad legislation, but he was not talking about it publicly to do Borges and FirstEnergy a favor. Yost “‘would be at the forefront (in opposition) if it weren’t for the support (of FirstEnergy) and your commitment,'” Borges quoted Yost as saying.
In another article, Borges – who had managed some of Yost’s previous campaigns – said of the repeal summary: “If he is legally able to refuse to use the language, he will do so..”
Irwin, Yost’s spokesman, justified the agreement by saying that FirstEnergy had reformed itself.
“FirstEnergy is not the same company today as it was five years ago – the company has initiated and continues to implement reforms to strengthen its internal ethics programs, increase transparency and encourage the reporting of questionable conduct by its employees and executives,” Irwin said. “It has also restructured its board and leadership to remove the individuals responsible for the conduct that led to the House Bill 6 scandal. This is an important step in holding disgraced company leaders who abused their positions of power to betray FirstEnergy’s customers and employees, as well as the people of Ohio, accountable for their crimes.”
But institutional investors are arguing in court that FirstEnergy is trying to limit the impact of the scandal, accusing the company of trying to protect other executives and board members who may have been guilty – or at least may have known about the plot.
In fact, the company is fighting tooth and nail to keep an internal investigation it commissioned into the scandal from being released. After an attempt to appeal the release order was rejected, the company filed a risky motion for a preliminary injunction on July 30.
After the HB 6 scandal broke in 2020, Yost donated $24,000 in contributions from FirstEnergy and Cespedes to charitable causes. It is an open question when he will explain what he knew and did in a scandal that put Householder in prison for 20 years and led to two suicides – including that of the defendant Lobbyist Neil Clark.
In the meantime, consumers are still paying a lot of money under HB 6, whose provisions that exclusively benefited FirstEnergy were repealed after the scandal. But state leaders have refused to repeal the rest of the law.
It contains a measure that paid so far 343,000,000 USD to subsidize two aging coal-fired power plants owned by a group of utilities in Ohio. One of them isn’t even in Ohio.
Get the morning’s headlines straight to your inbox
