July 17, 2020 – After many months of a smoldering investigation that’s already led to the sudden retirement of Anne Pramaggiore, a senior executive of Excelon Utilities last fall, led to the head of the City Club of Chicago, Jay Doherty, resigning last December.. today the U.S. Attorney’s office of Northern Illinois announced ComEd has agreed to pay $200 million in fines to settle the case. And in the charges made public, the U.S. Attorney’s office refers to House Speaker Madigan as “Public Offical A”
The U.S. Attorney’s office document lays out that a scheme that allegedly existed between the House Speaker’s office and ComEd, in which the utility agreed to give “things of value” including jobs, vendor subcontracts, and monetary payments.. for the benefit of “Public Official A and Public Official A’s associates, with the intent to influence and reward Public Official A”
In a “Deferred Prosecution Agreement” it is stated that “ComEd admits, accepts, and acknowledges that it is responsible under United States law for the acts of its current and former officers, employees, and agents 2 as charged in the Information and as set forth in the Statement of Facts, attached as Attachment A and incorporated by reference into this Agreement, and that the facts alleged in the Information and described in the Statement of Facts are true and accurate.Should the government pursue the prosecution that is deferred by this Agreement, ComEd agrees that it will neither contest the admissibility of nor contradict the Statement of Facts in any such proceeding, including any trial, guilty plea or sentencing
proceeding.“
On the Exelon website, the parent company of ComEd, Exelon CEO, Christopher Crane issued a letter in response to these charges..
“ Exelon Corp. and its ComEd subsidiary today announced that ComEd has entered into an agreement with the U.S. Attorney’s Office for the Northern District of Illinois to resolve the previously disclosed investigation into ComEd’s historical lobbying practices in Illinois. The resolution ends the investigation into ComEd by the Department of Justice (DOJ).
Exelon CEO Christopher M. Crane said, “We are committed to maintaining the highest standards of integrity and ethical behavior. In the past, some of ComEd’s lobbying practices and interactions with public officials did not live up to that commitment. When we learned about the inappropriate conduct, we acted swiftly to investigate. We concluded from the investigation that a small number of senior ComEd employees and outside contractors orchestrated this misconduct, and they no longer work for the company. Since then, we have taken robust action to aggressively identify and address deficiencies, including enhancing our compliance governance and our lobbying policies to prevent this type of conduct. We apologize for the past conduct that didn’t live up to our own values, and we will ensure this cannot happen again.”
Under the three-year deferred prosecution agreement, ComEd has agreed to make payments totaling $200 million, and has agreed to the government’s filing of a single charge that will be dismissed at the end of the three-year term, provided it abides by all terms of the agreement.
The fine will not be recovered in rates or charged to customers. The conduct at issue in the agreement relates only to ComEd, and the agreement does not contain any allegation of misconduct by Exelon or Exelon Generation. The agreement resolves the government’s investigation into both ComEd and Exelon. The related Securities and Exchange Commission investigation and civil lawsuits remain pending.
ComEd fully and substantially cooperated with the U.S. Attorney’s Office from the beginning of the investigation, and since that time, has taken extensive remedial measures. ComEd’s remediation and cooperation efforts were acknowledged specifically by the government in the resolution agreement.
As part of its remediation, Exelon implemented four new mandatory policies that apply to employees who interact with public officials. These policies lay out specific rules, procedures and tracking mechanisms governing 1) interactions with public officials; 2) vetting and monitoring of lobbyists and political consultants; 3) employment referrals or requests from public officials; and 4) vendor referrals or requests from public officials.
The policies also prohibit subcontracting of third-party lobbyists and political consultants, and hiring of such firms includes oversight from the company’s ethics and compliance team, led by David Glockner, Exelon’s executive vice president of Compliance and Audit.
Glockner was appointed to his role in March 2020 after having previously served as a senior Securities and Exchange Commission official and chief of the Criminal Division in the U.S. Attorney’s Office for the Northern District of Illinois, among other roles.
In addition, the company is conducting training on the new policies for employees as well as lobbying and political consulting partners. While the misconduct was limited to ComEd, the policies apply across all Exelon subsidiaries in Illinois and all other jurisdictions where Exelon operates, and are available on the company website.
Exelon and its operating companies are dedicated to providing customers and communities with clean, reliable, low-cost energy at the highest levels of service, efficiency and operational performance.
