FirstEnergy fires CEO, VPs after 2 plead guilty in nuclear bailout scandal

Perry Nuclear plant along Lake Erie in North Perry was one of two Ohio nuclear plants bailed...
Perry Nuclear plant along Lake Erie in North Perry was one of two Ohio nuclear plants bailed out by passage of House Bill 6.(Mark Duncan/AP)
Published: Oct. 30, 2020 at 8:41 AM EDT
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COLUMBUS, Ohio (FOX19) - First Energy says it has fired its chief executive officer and two senior vice presidents.

The announcement came just hours Thursday after two men pleaded guilty in a $61 million federal corruption scandal involving former Ohio House Speaker Larry Householder.

Federal prosecutors alleged earlier this year a utility believed to be FirstEnergy funneled millions of dollars into Generation Now, a group controlled by Householder that was used to get a nuclear power plant bailout passed by lawmakers and to support his political allies.

FirstEnergy said in a news release Thursday night an internal review related to the government investigations determined CEO Charles E. Jones; the senior vice president of product development, marketing, and branding; and its senior vice president of external affairs “violated certain FirstEnergy policies and its code of conduct."

Further details about the findings of the company’s internal review were not released.

Steven E. Strah, FirstEnergy president of FirstEnergy, has been appointed acting CEO, according to their release.

On Thursday afternoon, Juan Cespedes, 41, a lobbyist, and Jeffrey Longstreth, 44, a longtime campaign and political strategist for Householder, each pleaded guilty to participating in a racketeering conspiracy to pass and uphold a billion-dollar nuclear plant bailout, per a statement from U.S. Attorney David M. DeVillers’s office.

The extent of the men’s cooperation with federal authorities in the ongoing investigation is not yet clear.

It’s also not clear if Cespedes and Longstreth have agreed to testify against Householder and others.

Their attorneys could not immediately be reached for comment.

Householder, Cespedes, Longstreth, lobbyist Neil Clark and former Ohio Republican Chairman Matt Borges were all charged earlier this year with felony racketeering. One count is punishable by up to 20 years in prison.

RELATED: Ohio House Speaker Larry Householder, 4 others arrested in $61 million bribery case

Federal officials have accused a company believed to be FirstEnergy and its affiliates of funneling more than $60 million in bribes to Householder and four allies to help secure the bill’s passage and to help the campaigns of his supporters.

U.S. Attorney David DeVillers has called it “likely the largest money laundering scheme ever perpetrated against the people of the state of Ohio.”

House Bill 6 would create subsidies for two northern Ohio nuclear plants, in effect saving them from closing.

They will begin Jan. 1, 2021 and are expected to generate $150 million a year by way of fees on electricity bills in Ohio.

According to court documents, from March 2017-March 2020, a 501(c)(4) called Generation Now received millions of dollars in exchange for Householder’s and the enterprise’s help in passing House Bill 6.

Cespedes and Longstreth also “allegedly worked to corruptly ensure that HB 6 went into effect by defeating a ballot initiative to overturn the legislation,” the U.S. Attorney’s Office said in a statement.

“Longstreth admits in his plea to organizing Generation Now for Householder, knowing the entity would be used to receive bribe money to further Householder’s bid for Speaker of the House. Longstreth managed Generation Now bank accounts and engaged in financial transactions designed to conceal that the energy company was a source of funding to Generation Now.”

Cespedes also admitted that he orchestrated payments to Generation Now knowing the their purposes, the statement says.

Cincinnati is one of two major Ohio cities trying to prevent House Bill 6 from going into effect. Cincinnati Mayor John Cranley joined Columbus City Attorney Zach Klein to sue over it earlier this week.

Ohio Attorney General Dave Yost sued last month as well to try to halt it if state lawmakers did not repeal it.

FirstEnergy has denied wrongdoing, and its executives have not been charged.

The plants are now owned by Energy Harbor, a former FirstEnergy subsidiary previously known as FirstEnergy Solutions.

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