Exelon’s Commonwealth Edison agreed Friday to pay a $200 million fine to settle allegations that it bribed Illinois House Speaker Michael Madigan (D) in return for legislation that increased the company’s earnings and bailed out its money-losing nuclear plants.

The U.S. Attorney’s Office in Chicago filed a one-count information alleging that to influence legislation favorable to the company, ComEd arranged no-work jobs for Madigan associates including former Chicago Alderman Michael R. Zalewski, the father-in-law of Illinois Commerce Commission Chair Carrie Zalewski.

ComEd also admitted to appointing a Madigan ally to its board of directors, retaining a law firm favored by the speaker and providing internships to students who resided in the speaker’s Chicago ward. (See related story, How ComEd Got its Way with Ill. Legislature.)

Under the agreement, the bribery charge will be deferred for three years and then dismissed as long as ComEd continues to cooperate with “ongoing investigations of individuals or other entities” involved in the bribery charge.

While Madigan is not named directly in the documents released Friday, the scheme allegedly revolved around what the Deferred Prosecution Agreement called “Public Official A” identified as the “speaker of the Illinois House of Representatives and the longest serving member of the House of Representatives.” Madigan is the longest-serving leader of any state or federal legislature in U.S. history, having held the speaker title for all but two years since 1983.

“ComEd understood that, as speaker of the House of Representatives, Public Official A was able to exercise control over what measures were called for a vote in the House of Representatives and had substantial influence and control over fellow lawmakers concerning legislation, including legislation that affected ComEd,” officials wrote.

Representatives in Madigan’s legislative office confirmed that he had accepted subpoenas Friday in connection with “documents related to possible job recommendations.” Madigan’s office said he will cooperate with the subpoenas.

“The speaker has never helped someone find a job with the expectation that the person would not be asked to perform work by their employer, nor did he ever expect to provide anything to a prospective employer if it should choose to hire a person he recommended,” a spokesperson in Madigan’s office said. “He has never made a legislative decision with improper motives and has engaged in no wrongdoing here. Any claim to the contrary is unfounded.”

The Scheme

According to the charging documents, ComEd admitted that it began its efforts to bribe Madigan around 2011 and continued its efforts until 2019, after the FBI raided the homes and offices of lobbyists and others, including Michael Zalewski. During that span, the Illinois General Assembly considered bills and passed legislation having a “substantial impact on ComEd’s operations and profitability,” including electricity rates for ComEd customers and other legislation worth in excess of $150 million.

The U.S. Justice Department said ComEd made $1.3 million in indirect payments to Madigan’s associates, who performed little or no work for the utility.

Prosecutors said ComEd has provided “substantial cooperation with the federal investigations” and will continue to provide cooperation until the investigation and prosecutions are completed. Exelon officials pointed out that the $200 million fine — more than the $144 million profit ComEd reported for 2019 — will not result in rate increases or charges to its customers.

Company Response

Exelon, ComEd’s parent, said it “fully and substantially cooperated” with the U.S. Attorney’s Office since the beginning of the investigation and has taken internal measures to prevent similar incidents in the future.

Exelon CEO Christopher Crane said his company is “committed to maintaining the highest standards of integrity and ethical behavior,” acknowledging past lobbying practices with public officials “did not live up to that commitment.” Crane said that when Exelon learned about the lobbying practices, it started an internal investigation that identified a “small number of senior ComEd employees and outside contractors” involved in the scheme.

“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,” Crane said. “We apologize for the past conduct that didn’t live up to our own values, and we will ensure this cannot happen again.”

Exelon said it implemented four new policies governing interacting with public officials; vetting and monitoring of lobbyists and political consultants; employment and vendor referrals; and requests from public officials.

The grand jury probe leading to the bribery charge brought about the retirement of Exelon Utilities CEO Anne Pramaggiore on Oct. 15, less than a week after the company disclosed it had received a subpoena seeking communications between Exelon and state Sen. Martin Sandoval, a Chicago Democrat whose home and offices were raided by FBI agents in September. Sandoval’s daughter was hired by ComEd during Pramaggiore’s tenure. (See Exelon Pledges Reforms amid Grand Jury Probe.)

The breadth of ComEd’s involvement with Madigan, however, raises questions about whether all those who were aware of the company’s payoffs have left the company’s payroll.

Crain’s Chicago Business reported last December that ComEd and Exelon hosted an annual fundraiser for Madigan and the Democratic Party for at least five years that generated $100,000 or more annually. The 2017 invitation featured Crane prominently.

Reactions to the Charges

News of the allegations prompted harsh criticism on both sides of the aisle.

During an unrelated press conference, Gov. JB Pritzker (D), who took office in 2019, said the allegations were “very upsetting” and that Madigan “must resign” if they are true.

“People in public service need to live up to the integrity of the job they were asked to do,” Pritzker said. Madigan “needs to be forthcoming right away with answers.”

However, a spokesman for the governor told the Chicago Tribune that Pritzker “still has confidence in Carrie Zalewski, who is an accomplished regulator.”

Tim Schneider, chairman of the Illinois Republican Party, later called out the governor as well as Madigan in a statement, pointing to an investigation into $331,000 in alleged tax breaks Pritzker received in a remodeling project of a mansion he owns. “The people of Illinois now live in a state where both the speaker of the House and the governor are under criminal investigation,” Schneider said. “Even for a state with a history of corruption, this is unprecedented. Crimes of bribery and tax fraud cannot be tolerated from our elected officials.”

Tyson Slocum, energy program director of Public Citizen, a D.C.-based think tank, criticized the $200 million settlement for ComEd, calling it a “paltry sum.”

“The company’s successful lobbying blitz to pass controversial Illinois legislation in 2016 provided massive ratepayer-funded bailouts of its inefficient nuclear power plants — and forced ratepayers to fork over $235 million a year to Exelon for 10 years starting in 2017,” Slocum said. “This settlement is pennies on the dollar for what Exelon will earn off the bailouts.”