Ex-Ohio House Speaker Larry Householder convicted in bribery scheme

Lawmakers stripped Larry Householder of his speakership shortly after he was indicted in July 2020 and he won re-election that fall.
Published: Mar. 9, 2023 at 2:33 PM EST
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CINCINNATI, Ohio (FOX19/AP) - Former state House Speaker Larry Householder and former Ohio Republican Party Chair Matt Borges have been convicted in a $60 million bribery scheme that federal prosecutors have called the largest corruption case in state history.

A jury in Cincinnati found them guilty Thursday of conspiracy to participate in a racketeering enterprise involving bribery and money laundering following a trial that began on Jan. 23.

“As presented by the trial team, Larry Householder illegally sold the statehouse, and thus he ultimately betrayed the great people of Ohio he was elected to serve,” said U.S. Attorney Kenneth L. Parker.

“Matt Borges was a willing co-conspirator, who paid bribe money for insider information to assist Householder. Through its verdict today, the jury reaffirmed that the illegal acts committed by both men will not be tolerated and that they should be held accountable.”

Prosecutors alleged Householder orchestrated a scheme funded by FirstEnergy Corp. to secure power, elect legislative allies, then pass and defend House Bill 6, a $1 billion nuclear power plant bailout benefiting the utility. Prosecutors said Borges, then a lobbyist, helped.

Ohio lawmakers passed House Bill 6 and Gov. Mike DeWine signed it into law in 2019.

Federal officials have said Householder was a driving force of the financial rescue that tacked a new fee to every electricity bill in Ohio and directed over $150 million annually through 2026 to the plants near Toledo and Cleveland.

Householder, 63, and Borges, 50, both pleaded not guilty.

Lawmakers stripped Householder of his speakership shortly after he was indicted in July 2020 and he won re-election that fall.

In June 2021, nearly a year later, House lawmakers voted for only the second time in state history to expel a sitting member.

The bipartisan vote passed 75 to 21 with several local Republican lawmakers opposing: Bill Seitz of Green Township, Tom Brinkman of Mount Lookout, Jennifer Gross of West Chester Township, Sara Carruthers of Hamilton, Paul Zeltwanger of Mason and Shane Wilkin of Hillsboro.

“I’ll have my day in court,” Householder told his fellow lawmakers before the vote. “I’m confident that when a jury of my peers hears all the evidence, they’ll return a not guilty verdict.”

Two other men indicted in the case, Jeffrey Longstreth, Householder’s longtime campaign and political strategist, and Juan Cespedes, a lobbyist, both pleaded guilty in October 2020 to racketeering, which carries a penalty of up to 20 years in prison.

Both men testified at the trial and will be sentenced once the case is over.

The fifth man indicted with Householder in July 2020, Neil Clark, committed suicide in a Naples park in March 2021. Clark was a longtime lobbyist who owned and operated Grant Street Consultants. He also previously served as budget director for the Ohio Republican Caucus.

Court records allege in February 2017 Longstreth incorporated Generation Now as a 501(c)(4) social welfare entity purporting to promote energy independence and economic development; however, the entity was secretly controlled by Householder.

Clark stated in a recorded conversation, “Generation Now is the Speaker’s (c)(4),” court records show. The names and addresses of contributors to 501(c)(4)s are not made available for public inspection, as required by law.

In March 2017, Householder began receiving quarterly $250,000 payments from the related-energy companies into the bank account of Generation Now, federal court filings state.

The defendants allegedly spent millions of the company’s dollars to support Householder’s political bid to become Speaker, to support House candidates they believed would back Householder, and for their own personal benefit.

When asked how much money was in Generation Now, Clark said, “it’s unlimited,” court records show.

The affidavit filed in support of the criminal complaint also alleges:

  • In 2018, the enterprise spent energy company-to-Generation Now money on approximately 21 different state candidates – 15 (including Householder) in the primary, and six additional candidates in the general election. The Enterprise spent more than one million in fall 2018 alone to flood the airways with negative ads against enterprise opponents. Most of these candidates won the 2018 general election. All who won voted for Householder as Speaker.
  • Money passed from the energy company through Generation Now was used to pay for Householder campaign staff, which would otherwise have been paid by Householder’s candidate committee, Friends of Larry Householder.
  • Householder received more than $400,000 in personal benefits as a result of the payments into Generation Now, including funds to settle a personal lawsuit, to pay for costs associated with his residence in Florida, and to pay off thousands of dollars of credit card debt.
  • The enterprise paid $15,000 to an individual to provide insider information about the ballot initiative and offered to pay signature collectors for the ballot initiative $2,500 cash and plane fare to stop gathering signatures.

When federal officials announced the arrest of Householder and the fours in July 2020, they stressed that the investigation remains ongoing.

“We’re not done with this case,” said then-U.S. Attorney David DeVillers. “There are a lot of federal agents knocking on a lot of doors.”

Generation Now pleaded guilty in February 2021 to one count of participating in a racketeering conspiracy.

As part of the plea, Generation Now agreed to forfeit its assets, including nearly $1.5 million seized from organization bank accounts, federal officials say.

FirstEnergy last summer to the $60 million payment to Generation Now and a separate $4.3 million bribe to the former chairman of the Public Utilities Commission of Ohio, Sam Randazzo just before he started as Ohio’s top utility regulator.

The bribe was among millions in consulting fees First Energy paid Randazzo since 2010, according to federal records.

Gov. Mike DeWine appointed Randazzo to chair PUCO despite a cautionary letter from environmental groups and a 198-page dossier from his former campaign staffer warning against it.

Randazzo is an attorney who began his career as a member of the PUCO’s technical staff. He left and was appointed to act as an assistant attorney general for the State of Ohio and assigned to the PUCO section.

He then entered private practice where he focused on energy, communications and utility law.

Randazzo retired from the law firm of McNees Wallace & Nurick LLC at the end of 2018, where he provided guidance to a broad range of clients including residential, commercial and industrial customers, cooperatives, municipally-owned and investor-owned utilities, according to the PUCO’s website.

His experience includes developing Ohio’s innovative self-help natural gas program in 1973; implementation of the Telecommunications Act of 1996 in Ohio; proactive leadership on Ohio utility legislation providing customers with supply-side and demand-side choices; and general counsel to the Industrial Energy Users-Ohio (IEU-Ohio).

Randazzo resigned his position with the PUCO in November 2020 after the FBI searched his Columbus home as part of an investigation into the bribery scandal

“The impression left by an FBI raid on our home, the statement included in FirstEnergy Corp.’s filing with the Securities and Exchange Commission yesterday and the accompanying publicity will, right or wrong, fuel suspicions about and controversy over decisions I may render in my current capacity,” he wrote in his resignation letter to DeWine.

“In present times, when you, good sir, are valiantly battling to save Ohioans from the surging attack of COVID-19, there is no room or time for me to be a distraction.”

Randazzo has not been charged with a crime and his attorney has repeatedly said Randazzo did nothing wrong.

Ohio Attorney General Dave Yost filed a civil suit in September 2020 against Householder, FirstEnergy, Energy Harbor and accomplices, aiming to freeze profits they realized from the scheme.

Randazzo and FirstEnergy executives “engaged in money laundering, coercion, intimidation and an attempted cover-up by a politically connected group trying to enrich themselves,” according to court records amended by Yost.

In August 2021, a Franklin County judge granted Yost’s request to freeze Randazzo’s assets. However, the 10th District Court of Appeals reversed that decision.

In early January, the Ohio Supreme Court agreed to hear Yost’s appeal to re-freeze Randazzo’s accounts.

Yost has said Randazzo transferred the title of a $500,000 home to his son and sold four other properties worth a combined $4.8 million.

“FirstEnergy admitted to bribing Randazzo to the tune of $4.3 million to help construct House Bill 6, and he should be accountable for those actions,” Yost announced in August 2021 as he sought to seize up to $8 million of Radazzo’s assets.

“Randazzo is making moves that will make it harder to hold him financially accountable for accepting bribes. As the federal investigation continues, we need to make sure that his assets are available for recovery when his time comes to pay.”