Exelon Corp., the parent company of Commonwealth Edison (ComEd), has agreed to pay $46.2 million in penalties as part of a settlement with the Securities and Exchange Commission (SEC) in connection to the ongoing scandal involving indicted former Illinois House Speaker Michael Madigan. The SEC charged Exelon and ComEd with fraud, alleging a scheme to influence and reward Madigan through utility legislation passed between 2011 and 2019. Former ComEd CEO Anne Pramaggiore also faces new bribery-related charges from the SEC, which will be litigated separately.
This settlement follows ComEd’s deferred prosecution agreement in July 2020, where the electric utility agreed to pay a $200 million fine and cooperate with prosecutors in exchange for dropping a bribery count. The Illinois Commerce Commission had previously approved a refund of approximately $38 million for ComEd customers to address the question of whether customer costs were tied to the inappropriate conduct.
Exelon stated that the recent SEC penalties were based on past conduct and that the company has since implemented enhanced compliance measures to prevent similar incidents. The $46.2 million penalty could potentially go to investors harmed by the misconduct, according to the SEC order.
Michael Madigan, who was the longest-serving state House speaker in American history before being ousted in 2021, is facing a racketeering trial in April. The trial is expected to focus on allegations that ComEd appointed Madigan’s recommended individuals to its board and provided benefits to his allies in exchange for legislative support.
The SEC complaint against Pramaggiore alleges her participation in the bribery scheme and misleading investors about ComEd’s lobbying activities. Exelon and ComEd consented to a cease-and-desist order from the SEC, which found violations of antifraud and accounting controls required under federal securities laws.
The ongoing scandal also involves AT&T Illinois, which has agreed to pay a $23 million fine as part of its deferred prosecution agreement with the U.S. attorney’s office. The upcoming trial involving Madigan and Michael McClain, his confidant, also includes allegations of collaboration with Ald. Danny Solis in a failed attempt to transfer state-owned property.