ComEd to pay $200M in federal bribery investigation; Illinois House Speaker Mike Madigan implicated in charge

US Attorney John Lausch, Jr. spoke on case Friday

ByChuck Goudie and Barb Markoff, Christine Tressel and Ross Weidner WLS logo
Saturday, July 18, 2020
ComEd to pay $200M in federal bribery investigation; Illinois House Speaker Mike Madigan implicated in charge
ComEd will pay $200 million to end a federal criminal investigation into a bribery scheme, the U.S Attorney's Office said Friday.

CHICAGO (WLS) -- For most of the last decade the powerful Speaker of the Illinois House, Rep. Michael Madigan, secretly benefited from bribes that electric utility ComEd now admits paying, according to criminal charges filed Friday by the U.S. Attorney in Chicago.

Madigan, a southwest side state representative since 1971, was not charged in today's filing but is clearly implicated in the scheme.

For its part, ComEd is agreeing to pay $200 million to conclude what has been a several-year federal investigation of suspected illegal lobbying, political graft and sweetheart contract deals for the near-monopoly power utility.

READ: Subpeona to the Office of Speaker Michael J. Madigan

The deal-making that ComEd officials now admit will end in a legal deal with federal prosecutors-what is known as "deferred prosecution." Such arrangements allow liability to go away once the terms of the agreement are met: Most notably, in this case, the criminal prosecution of the company would end with completed payment of the $200 million fine and three years of what amounts to supervision.

As part of the agreement, ComEd admits that its efforts to influence and reward "Public Official A," or the Speaker of the Illinois House, "began in or around 2011 and continued through in or around 2019."

Prosecutors state that the person identified as House Speaker Madigan sought to obtain from ComEd sweetheart contracts and money for himself and various associates "such as precinct captains" who operated in his legislative district.

In a statement Friday, Madigan's office said, "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. He has never made a legislative decision with improper motives and has engaged in no wrongdoing here. Any claim to the contrary is unfounded. This morning the Speaker accepted subpoenas related to his various offices for documents, asking for, among other things, documents related to possible job recommendations. He will cooperate and respond to those requests for documents, which he believes will clearly demonstrate that he has done nothing criminal or improper."

ABC7 obtained subpoenas served to Madigan Friday night, requesting other documents related to AT&T, Walgreens, and Rush University Medical Center.

Certain senior executives of ComEd during the near-decade were aware that the purpose of the payments was to buy influence, according to authorities.

I-Team: Tracking down Mike Madigan

Michael Madigan has been found, and not in Wisconsin or La Jolla, California or Palm Springs, as some had speculated.

"Don't put anything in writing" one of the participants in the scheme is quoted as saying. "All it can do is hurt ya."

The time-span saw bills introduced to the Illinois General Assembly and legislation passed that directly affected ComEd's profitability as a corporate public utility.

According to the federal information filed Friday, ComEd "corruptly gave, offered, and agreed to give things of value, namely, jobs, vendor subcontracts, and monetary payments associated with those jobs and subcontracts" for the Speaker's benefit and with "intent to influence" him and his associates.

The company has also admitted that some of the jobs were no-show positions or that little work was ever done.

The jobs-for-favors scheme alleged to have been overseen by Speaker Madigan was an "old fashioned patronage system" according to one participant quoted in the government filing.

In one quoted conversation, the Speaker is referred to as "our friend," a term more commonly used by Chicago Outfit bosses in their own corrupt political and business dealings.

In the deferred prosecution agreement, the government cites ComEd's "substantial cooperation" including "organizing voluminous evidence and information for the government." The agreement does not let individual employees off the hook and there are other potential charges hanging in the balance, according to sources familiar with the investigation. The deferred prosecution agreement also commands ongoing future cooperation from the utility.

In a statement on Friday, 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."

Mayor Lori Lightfoot addressed the issue during a press conference Friday afternoon announcing the Chicago Public School's preliminary plans for the 2020-2021 school year.

"The conduct admitted to by ComEd in the Deferred Prosecution Agreement unveiled today is deeply disturbing. The Department of Justice is appropriately holding ComEd accountable for their criminal conduct. As a significant vendor for the City of Chicago, ComEd must also be accountable to the taxpayers and residents of Chicago. As Mayor, I have made transparency, reform and accountability pillars of my administration. And, as a former federal prosecutor myself, I know the thorough and meticulous work that goes into the scale of this kind of investigation and this type of agreement," she said in a statement.

Lightfoot announced that the city's Committee on Environmental Protection and Energy will hold a public hearing on July 30 to hear directly from ComEd leadership and community members.

"Chicagoans deserve fairness and transparency from all who are paid with taxpayer dollars, and my administration will do everything in our power to ensure that expectation is a reality," she said.