Editorial: Victim is Ohio

The stain upon Ohio government created by the conduct of Larry Householder and Matt Borges will not be soon or easily erased.

The scheme that victimized all Ohioans and made an untold number of Ohio government officials knowing or accidental participants in a massive fraud deserves a punishment that will deter future corruption at this scale.

A step in that direction can be taken by Judge Timothy Black, who will sentence the two for racketeering activity including wire fraud, bribery, and money laundering, following their convictions Thursday in federal court in Cincinnati.

The United States Sentencing Commission reports a 23-month prison sentence as the average for 156 bribery convictions in 2021.

The crime that was meticulously investigated and prosecuted is far from the “average” bribery case. Former Councilman Bob McCloskey took $5,000 in bribes in an FBI sting — well below the median bribe of $52,328 in 2021. In 2006, he received a sentence of 27 months and served 20.

The sentencing guidelines allow a judge to escalate a sentence based on the impact on victims.

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All Ohio citizens are victims of this tragedy. The goal of this crime was to raise $1.3 billion from ratepayers and transfer that money to FirstEnergy. That’s a lot more than the harm done by McCloskey.

Also to be taken into account is the harm done to Ohioans’ faith in their government.

The federal criminal code allows a 20-year maximum sentence for racketeering. The penalty should be commensurate with the level of damage done.

There are precedents for sentences well beyond the average.

● Jeffrey Skilling, CEO of Enron, was sentenced in 2006 to 24 years in prison for selling $60 million worth of shares based on insider knowledge.

●James Traficant, former Eastern Ohio congressman, was sentenced to seven years for bribery, racketeering, and tax evasion.

● Former FBI agent Babak Broumand of Los Angeles in 2016 got six years in federal prison for conspiring to accept at least $150,000 in cash bribes and other items of value.

●Fred Buenrostro, the former CEO of the California Public Employee Retirement System, was sentenced to four and a half years for conspiracy to trade official acts for some $250,000 in cash and benefits — much less than the $514,000 Householder took and the $366,000 that Borges took. And that excludes the rest of the $61 million that was spread around as campaign contributions and who knows what other expenditures, or the $1.3 billion impact on Ohio electrical ratepayers.

Factors that increase a sentence include being a public official, involving a high-level elected official, and abusing a public position of trust.

The Blade Editorial Board believes Householder and Borges should serve a stiff sentence that expresses the magnitude of the crime, if that takes every day of the 20-year maximum.

The “nothingburger” case as framed by former Ohio House Speaker Householder’s attorneys portrayed this $61 million bribery scheme as “politics as usual” at the Statehouse. Sadly politics as practiced at the Ohio Statehouse has been correctly judged by a federal trial jury as criminal racketeering.

Householder and former Ohio Republican Party Chairman Borges were both found guilty for their roles in a conspiracy to trade $61 million in campaign contributions from FirstEnergy for the bailout of two financially failing nuclear power plants.

Federal prosecutors Emily Glatfelter, Megan Gaffney Painter, and Mathew Singer, and FBI Agent Blane Wetzel presented an intricate case in painstaking detail. The government showed how the social welfare political nonprofit Generation Now was created at the direction of Householder to convert FirstEnergy cash to campaign funds for Ohio House candidates loyal to Householder.

Once those Householder loyalists voted to make him speaker, Householder went to work on the FirstEnergy bailout. When the controversial legislation that forced residents and businesses throughout Ohio to pay higher utility rates was threatened with repeal by voter referendum, Borges joined the conspiracy to derail that option.

Prosecutors documented that all of the FirstEnergy conspirators dipped into the Generation Now political money for personal use. Judge Black instructed jurors that it was a bribe to take money for political action, even if the bribe-taker agreed with the policy.

Jurors were not told of FirstEnergy’s admission of bribes paid to Householder and former PUCO Chairman Sam Randazzo, who has not been charged. FirstEnergy paid a $230 million fine for its role in the conspiracy. Executives who authorized the payments are not protected against prosecution by the FirstEnergy deferred prosecution agreement.

The Householder-Borges defense was built upon the premise that a bribery case without the alleged bribe payers was evidence of prosecutorial overreach. It’s imperative that the Justice Department not make Householder and Borges martyrs by ignoring the other side of the criminal conspiracy. Without the rest of the conspirators this will be cast in Columbus as a political hit job.

Historically Ohio has not been blemished by blatant political corruption associated with some other states. With the federal convictions Ohio has entered a new era.

The toughest possible sentences will hold Householder and Borges accountable for conduct that victimized all of Ohio to enrich themselves.