Legal Move Delays ComEd’s First Installment of $200 Million Corruption Fine

ComEd sign
A ComEd facility on Chicago's North Side in August 2020. The power company has agreed to pay a $200 million fine to end a federal investigation into what the company admits was an eight-year effort to buy influence in the Illinois Capitol. WBEZ
ComEd sign
A ComEd facility on Chicago's North Side in August 2020. The power company has agreed to pay a $200 million fine to end a federal investigation into what the company admits was an eight-year effort to buy influence in the Illinois Capitol. WBEZ

Legal Move Delays ComEd’s First Installment of $200 Million Corruption Fine

Commonwealth Edison got a temporary reprieve from its due date to pay the first installment of a $200 million fine in a federal corruption case Monday.

The delay came after a Chicago lawyer argued ComEd – which is supposed to pay the fine to the U.S. treasury – should instead pay back electricity-delivery customers who were victims of the power company’s long-running Springfield bribery scheme.

Executives with the massive public utility had agreed to pay half of the fine within a month of announcing a deal with prosecutors on July 17, court records show.

But lawyer Joseph Stewart argued “that restitution is due to non-federal victims of ComEd’s bribery scheme” before any money goes to the U.S. government.

Under what’s known as a “deferred prosecution agreement” with prosecutors in Chicago, ComEd agreed to pay the fine to end a federal investigation into what the company admits was an eight-year effort to buy influence in the Illinois Capitol. In the agreement, the benefits of the scheme for ComEd were said to exceed $150 million.

But that amount “might be substantially higher,” Stewart argues, citing WBEZ’s reporting on the cost to ratepayers of two state laws ComEd won during the bribery scheme.

In a court hearing Monday, Assistant U.S. Attorney Amar Bhachu defended prosecutors’ deal with the power company and opposed any effort to divert fine money from the federal treasury in order to pay ComEd’s customers.

“This motion is completely without merit,” Bhachu said in the hearing before U.S. District Judge John Kness.

But Bhachu said Monday the government would take action to “maintain the status quo,” suggesting that no money would go into the federal treasury before Kness rules on Stewart’s motion. The remaining $100 million of the fine was supposed to be due two months from now.

Kness gave the government and ComEd a week to file briefs on the motion, and Stewart will then get to respond to those briefs, the judge said.

“I take the issue of victims’ rights very seriously,” Kness said.

The judge added, though, that he doubts he has the authority to step in and make any changes to the deal between prosecutors and the federal government, and he promised to rule swiftly on the high-dollar motion.

The fine was far lower than the sentencing guidelines for ComEd’s behavior mandated, but the feds argued for leniency because the company has cooperated with the ongoing probe of political corruption.

Court records in the corruption case show ComEd won two lucrative measures in Springfield, in 2011 and 2016, during the bribery scheme. One of the measures led to big increases in what homes and businesses pay for electricity delivery – and an even-bigger spike in ComEd’s profits, a WBEZ analysis found.

Regardless, top ComEd executives have launched an out-of-court public-relations campaign to preserve those gains. In the past month, they’ve argued that the company’s illicitly-gained legislative triumphs have actually benefited roughly 4 million customers in northern Illinois.

The bribery scheme involved ComEd funneling about $1.3 million to politically connected consultants who did little or no work. According to court documents in the case, the corruption was designed to curry favor with “Public Official A” – a clear reference to Illinois House Speaker and Democratic Party of Illinois boss Michael Madigan.

Madigan has not been charged and denies wrongdoing. He’s leading the Illinois delegation at this week’s Democratic National Convention.

Dan Mihalopoulos is an investigative reporter on WBEZ’s Government & Politics Team.