Exelon Warns Investors That ComEd Probes Could Be Costly
For the first time, Exelon Corp. acknowledged to investors Tuesday that it and its subsidiary, Commonwealth Edison, could face criminal or civil penalties as a result of dual federal investigations into the companies’ lobbying activities.
The admission — that the probe’s outcome could threaten future earnings — appeared in Exelon’s annual report filed with the federal Securities and Exchange Commission and signals deepening worry over the investigations by U.S. Attorney John Lausch’s office in Chicago and the SEC.
“The outcome of the U.S. Attorney’s Office and SEC investigations cannot be predicted and could subject Exelon and ComEd to criminal or civil penalties, sanctions or other remedial measures,” Exelon said in its filing.
“Any of the foregoing, as well as the appearance of non-compliance with anti-corruption and anti-bribery laws, could have an adverse impact on Exelon’s and ComEd’s reputation or relationship with regulatory and legislative authorities, customers and other stakeholders, as well as their consolidated financial statements,” the company said.
Exelon officials did not detail those possibilities during a conference call with analysts on Tuesday morning.
Up until now, Exelon publicly reported to federal securities regulators only that it had been subpoenaed twice last year by federal prosecutors, focusing partly on its lobbying activities and relationship with former Illinois State Sen. Martin Sandoval, D-Cicero.
Earlier this month, Sandoval pleaded guilty to federal bribery and tax evasion charges under a plea deal in which he agreed to cooperate with prosecutors in ongoing criminal investigations. Sandoval’s sentencing was pushed off until late July.
When federal agents raided Sandoval’s statehouse office last September, their search warrant indicated an interest in an array of subjects, including the senator’s interaction with four unidentified Exelon officials and any documents related to utility rate increases.
Shortly thereafter, Exelon Utilities former senior executive vice president and CEO, Anne Pramaggiore, abruptly resigned her position as one of Chicago’s most prominent female business executives.
WBEZ also has reported that federal agents raided the offices of ComEd lobbyist Jay Doherty and the home of another lobbyist for the company, Michael McClain, a confidant of House Speaker Michael Madigan, D-Chicago.
Neither Pramaggiore, Doherty, McClain nor Madigan have been charged with any wrongdoing.
Dave McKinney covers state politics and government for WBEZ. Follow him on Twitter @davemckinney.