U.S. Attorney David DeVillers. Official photo.
The cruel fortunes of politics mean that David M. DeVillers stopped being the top federal law enforcement official for Southern Ohio on Sunday. But the attorney who last July announced the arrest of then-House Speaker Larry Householder, last week said the investigation that led to the arrest isn’t going anywhere.
The scandal surrounding what DeVillers said was “likely the largest bribery and money-laundering scheme ever in the state of Ohio,” continues to rock Capitol Square as prosecutors and investigators continue their work.
“I’m not going to say (there are going to be) more charges, but the investigation is not complete,” DeVillers, 55, said during an interview in his Arena District Office, flanked by portraits of Frederick Douglass, William Tecumseh Sherman and Alexander Hamilton.
For an office that prosecutes federal crimes across a 48-county area, it was strangely quiet last Wednesday, as some employees worked from home and DeVillers prepared to leave.
After just 17 months in office, he is being forced to depart. Although the U.S. Department of Justice is supposed to operate with a great degree of autonomy, incoming presidents — particularly of a different party — traditionally oust sitting U.S. attorneys to make room for their own.
DeVillers said he understood it was part of the game and said he was confident that the career attorneys in his office and agents with the FBI would continue their probe into the 2019 passage of House Bill 6, a $1.3 billion package of ratepayer bailouts.
Most of the funds were to prop up two supposedly failing nuclear plants. Lesser amounts were intended to provide Akron-based FirstEnergy with revenue guarantees and to subsidize two aging coal-fired generators owned by a group of electricity giants.
Prosecutors allege that FirstEnergy and its associates funneled $61 million through 501(c)(4) “dark money” groups and into a corrupt effort to make Householder speaker, pass HB 6 and defend it against a citizen initiative to repeal the legislation.
Two of the four Householder associates who were also arrested have pleaded guilty, as has Generation Now, a dark money group at the heart of the enterprise.
When DeVillers declined to say whether we can expect more charges, he wasn’t saying they won’t happen. Rather, he was saying he can’t comment on whether they would.
“Our grand jury has been closed down since early November for the most part because of covid,” he said. “It’s opening up again in March, so we can start using a grand jury again to present witnesses, indictments and subpoena things. But we’ve got a lot of cases in the hopper right now that are people who have been locked up on arrest warrants that we have to indict that are called ’30-day’ cases.
“But then the next step will be anything involving not necessarily (the HB 6) case, but anything involving our long-term historical investigations, which tend to be corruption cases and white-collar criminal cases.”
It’s unclear who might be getting a look from the grand jury. But news continues to dribble out about two figures involved in the fight over HB 6: former FirstEnergy CEO Chuck Jones and former Public Utility Commission Chairman Sam Randazzo. Both men have denied any wrongdoing.
In October, FirstEnergy fired Jones after an internal investigation revealed that the company had made a $4 million payment in early 2019 to a former FirstEnergy lobbyist as that person was taking a full time position with Ohio’s utility regulator, the PUCO. Gov. Mike DeWine, who appointed Randazzo, later confirmed that Randazzo received such a payment, but DeWine said he was unaware of it when he appointed Randazzo.
Randazzo resigned on Nov. 20, after the FBI raided his Columbus home.
Further bad news for Jones and Randazzo came earlier this month when, in a regulatory filing, FirstEnergy said the $4 million payment to Randazzo might not have been for the purposes stated.
“FirstEnergy believes that payments under the consulting agreement may have been for purposes other than those represented within the consulting agreement,” it said.
As he stressed that he wasn’t commenting on any one case, DeVillers said, “Stay tuned for the next couple months.”
Among the guilty pleas so far in HB 6 is that of Generation Now, the dark money group through which tens of millions have flowed and fueled the conspiracy to pass HB 6. The group was founded by Jeffrey Longstreth, Householder’s longtime political strategist, who in October pleaded guilty to his role in the conspiracy.
They’re called “dark money” groups because the nonprofit organizations were formed under a section of the IRS code that allows them to hide the sources of their money. As “social welfare” organizations, they’re not allowed to spend more than half their money on electioneering, although the IRS is notoriously lax in enforcing the rule.
In announcing Generation Now’s guilty plea, DeVillers’ office called it a “purported social-welfare organization” and noted that it concealed the source of the $61 million used in the effort to pass HB 6.
Asked how those things were illegal, he explained that they were components of the racketeering allegations that tie the case together.
“They would be elements of the predicate of racketeering,” DeVillers said. “In a way, money laundering is a predicate. That is evidence of money laundering: Hiding the nature of the proceeds, or where the proceeds came from, is money laundering. So while it in and of itself isn’t a crime, it’s evidence of a crime.”
In the wake of Householder’s arrest, questions have been raised about another DeWine appointee, Legislative Affairs Director Dan McCarthy.
In 2017, while he was still a FirstEnergy lobbyist, McCarthy founded another dark money group, Partners for Progress, two days after the formation of Generation Now. Within a week, Partners for Progress received $5 million from FirstEnergy and within a month it was passing the first of what would be more than $1 million to Generation Now, while McCarthy was still the group’s president, according to an affidavit accompanying Householder’s arrest.
McCarthy has denied wrongdoing, but he and DeWine have refused to explain who asked McCarthy to start the organization or what he believed the money was for.
Asked if it’s possible that the HB 6 investigation might be making its way into the governor’s office, DeVillers seemed to rule that out. Sort of.
“I’m not going to talk about any ongoing investigation, other than that there is one,” he said. “But yeah, basically what I’m saying is there are people who are in positions of public trust (and) it’s important to know that if we thought they were involved in something to the extent that we thought there was probable cause, we would have arrested them… You’ve got (Former Franklin County Prosecutor) Ron O’Brien — now (G. Gary) Tyak — you’ve got (Ohio Attorney General Dave) Yost, you’ve got the governor.
“At this point if we thought there was some sort of probable cause that they had committed a crime I can tell you, we would have gone forward with a complaint on that. You can by process of elimination answer your question on that.”
But, the outgoing U.S. Attorney added, “It’s an ongoing investigation. If we find probable cause to believe they committed crimes, we will charge them.”
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