A federal grand jury last month (Nov. 29) indicted former Ohio utility regulator and long-time player in a long-running electric utility scandal Sam Randazzo, 74, on charges of bribery and embezzlement. He appeared in court Dec. 4 and pleaded not guilty, refusing to comment to reporters.
Randazzo is charged “with one count of conspiring to commit travel act bribery and honest services wire fraud, two counts of travel act bribery, two counts of honest services wire fraud, one count of wire fraud and five counts of making illegal monetary transactions.”
His indictment was the latest in the long-running $60 million Ohio bribery scandal, in which Akron-based First Energy electric holding company paid key Republican legislators and party figures to pass legislation, HB6, bailing out two economically uncompetitive nuclear plants and two elderly coal-fired plants, which Republican Gov. Mike DeWine signed into law. The legislation was worth some $1 billion to First Energy.
The utility then used customer funds to bankroll opposition to a statewide ballot initiative repealing the bailout, which narrowly failed. So far, the unraveling of the scheme has landed the former speaker of the Ohio House and a key GOP lobbyist in jail.
In a news release, the Justice Department said that when Randazzo was the DeWine-appointed chairman of the Public Utilities Commission of Ohio (PUCO) he “allegedly received more than $4.3 million from an energy company and its affiliates to provide favorable official actions for the company through PUCO proceedings.” Randazzo was PUCO chairman from April 2019 to November 2020, when he resigned as the bribery scheme began to unravel and after the Federal Bureau of Investigation raided his home.
The DOJ press release alleged that in “November 2019, Randazzo included language in a PUCO Opinion and Order that would address an issue for the energy company that was slated to happen in 2024. ‘Stock is gonna get hit with Ohio 2024. Need Sam to get rid of the ‘Ohio 2024 hole,’ an energy executive text message read. Another executive messaged, in part: ‘I spoke with Sam today. Told me 2024 issue will be handled next Thursday.’ The next Thursday, the PUCO decision included language alleviating the 2024 issue.”
Randazzo was a major figure in Ohio electric utility policy and politics for decades before his appointment to the PUC. A lawyer, he began his career as a PUCO staffer. When he left the commission, he was appointed an Ohio assistant attorney general and assigned to the section covering the PUCO. In the 1990s as Ohio was going through electric industry restructuring, Randazzo became the key actor in Industrial Energy User-Ohio, group representing the many of the state’s large industrial customers.
The indictment says that in 2010, Randazzo formed a consulting firm, Sustainability Funding Alliance of Ohio (SFA). Justice says he “used his consulting business, SFA, to carry out an embezzlement scheme, funneling to himself at least a million dollars meant for an association of large, industrial energy users in Ohio.
“Randazzo was the general counsel of the industry group for multiple years, including from 2010 until his PUCO appointment, and at times served as the industry group’s executive director. Randazzo controlled the industry group’s bank accounts.
“It is alleged Randazzo entered into settlements with companies on behalf of the industry group and kept portions of the settlement payments for himself. As one method to conceal his alleged embezzling, Randazzo allegedly created a fictitious member of the industry group that received payments along with legitimate members.
“For example, in March 2019, it is alleged Randazzo attempted to conceal his embezzling by wiring approximately $1.1 million between bank accounts under his control.” He could face up to 20 years in jail, likely a life sentence.
Earlier, U.S. District Court Judge Timothy Black sentenced former Ohio House Speaker Larry Householder to 20 years for his key role in the HB6 bribery. Black will preside over Randazzo’s trial.
Randazzo was engaged in the legal dance over HB6 bribes before the federal indictment. In 2021, a state judge allowed Ohio’s attorney general to freeze some $8 million in Randazzo’s assets, after First Energy admitted it paid $4.3 million to Randazzo in bribes. Attorney General Dave Yost sought to prevent Randazzo from disposing assets beyond the reach of the state. The lower court ruled, “I find that there is a present danger that the property will be immediately disposed of, concealed, or placed beyond the jurisdiction of the Court,” and garnished the assets.
In September 2022, a state appeals court overruled the lower court decision, concluding in a scathing judgment that “neither the hearing transcript nor the order issued by the trial court indicates the trial court engaged in a sound reasoning process in reaching its conclusion.”
The role of Gov. DeWine, who signed HB6 into law and later largely repealed it, is unclear. Celeveland.com reported Nov. 30 that DeWine has been subpoenaed and Lt. Gov. Jon Husted is slated to be deposed in a civil lawsuit related to the FirstEnergy bribery scandal.
–Kennedy Maize
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