Politics |

Federal investigation draws closer to Madigan as ComEd will pay $200 million fine in alleged bribery scheme; Pritzker says speaker ‘must resign’ if allegations true

A federal investigation orbiting the political operation of Illinois House Speaker Michael Madigan drew much closer to the powerful politician Friday, as prosecutors unveiled a criminal complaint charging ComEd in a “years-long bribery scheme” involving jobs, contracts and payments to Madigan allies.

Prosecutors said the utility attempted to “influence and reward” Madigan by providing financial benefits to some close to him, often through a key confidant and adviser at the center of the probe. Madigan, the nation’s longest-serving speaker and Illinois Democratic Party chairman, has not been charged with any wrongdoing.

In announcing the case against ComEd, U.S. Attorney John Lausch called public corruption a continuing problem in Illinois and said his office was not finished, while not addressing Madigan specifically.

“Our investigation is ongoing” Lausch said. “It’s vibrant, and it will continue.”

Madigan, described in the new court filing as Public Official A, the speaker of the House, previously has said he was “not a target of anything” when asked about the federal probe.

On Friday, a spokeswoman acknowledged Madigan had been subpoenaed for information including “possible job recommendations,” and said he would cooperate with those requests.

“He has never made a legislative decision with improper motives and has engaged in no wrongdoing here. Any claim to the contrary is unfounded,” spokeswoman Maura Possley said in an email.

“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,” Possley’s statement read.

The investigation appears to go well beyond ComEd. In Friday’s federal subpoena, authorities sought records related to AT&T, Walgreens and Rush University Medical Center, as well as the utility, according to a copy of the subpoena obtained by the Tribune. The subpoena also sought records related to Madigan’s political organization and law firm, as well as former state lawmakers and current or former Chicago aldermen.

The subpoena has not been made publicly available and a spokesman for Madigan told the Tribune to file an open records request, which had not been fulfilled Friday evening.

ComEd’s parent company, Exelon, said in a statement that it had cleaned up its lobbying practices and noted it had pledged to fully cooperate with the investigation.

Prosecutors said the scheme began around 2011 — when key regulatory matters were before the Illinois House that Madigan controls — and continued through last year. They agreed to defer their prosecution of ComEd for three years as it cooperates in the investigation, and announced the company had agreed to pay a record $200 million fine.

The new filing made clear that the nexus of the federal investigation into ComEd and Madigan’s operation is Michael McClain. He’s a close friend and adviser to the speaker, as well as a former lawmaker and Quincy attorney who retired as a high-profile lobbyist for the utility in 2016 but continued collecting six-figure payments from the company.

Federal agents raided McClain’s home in Quincy in May 2019, which turned out to be the same month ComEd said it had stopped paying him. The Tribune exclusively reported in November that authorities secretly recorded McClain’s phone calls.

Friday’s federal filing appeared to include quotes from those recordings. The Tribune reported in January that authorities had asked McClain to cooperate with the investigation. At the time, WBEZ 91.5-FM asked McClain if he was cooperating. “I’ll just say they asked,” he replied.

McClain’s attorney did not respond to requests for comment Friday.

The federal filing did not outline any conversations had by Madigan. Referring to the speaker as Public Official A and McClain as Individual A, prosecutors did allege the two “sought to obtain from ComEd jobs, vendor subcontracts, and monetary payments associated with those jobs and subcontracts for various associates of Public Official A.”

Those included precinct workers and other associates, the filing states, and prosecutors alleged the total they received was $1.32 million.

Democratic Gov. J.B. Pritzker, who worked with Madigan to approve a wide-ranging legislative agenda in 2019, said he was “deeply troubled and frankly I’m furious” about the reports of the case.

“The speaker has a lot that he needs to answer for — to authorities, to investigators and most importantly to the people of Illinois,” Pritzker said at an unrelated event in Waukegan. “If these allegations of wrongdoing by the speaker are true, there is no question that he will have betrayed the public trust and he must resign.”

In all, prosecutors put a value of at least $150 million on the legislative benefits ComEd received. The federal documents in particular noted the 2011 passage of the Energy Infrastructure and Modernization Act, which “helped improve ComEd’s financial stability” by establishing rate guidelines and a smart grid overhaul.

That year, the filing states, the individual known to be McClain, and a lobbyist the Tribune has identified as John T. Hooker, made a plan to direct money to two Madigan associates who would be paid by ComEd as subcontractors to a consultant. Those payments went on for years despite the associates doing little or no work, prosecutors said.

The payments were recorded as being paid to a company by the consultant for advice on “legislative issues,” according to the paperwork. Some “senior executives and agents” of ComEd were aware of the payments, the paperwork states. Hooker could not be reached for comment Friday.

Prosecutors did not allege or specify any of the payments were diverted to Madigan himself.

But prosecutors did allege that in May 2018, Madigan, through McClain, asked the utility’s CEO to hire an associate of the speaker who was leaving the Chicago City Council. The Tribune has identified the now-former CEO as Anne Pramaggiore, and the council member as former 23rd Ward Ald. Michael Zalewski, who could not immediately be reached Friday.

Coordinating with another executive and a consultant, Pramaggiore agreed the associate, Zalewski, would be paid $5,000 a month as a subcontractor, through a company in the scheme that already had a relationship with ComEd, according to a federal filing.

The former Exelon CEO abruptly retired in October amid the probe. Pramaggiore’s exit came less than a week after the company acknowledged receiving a second subpoena linked to the investigation.

Pramaggiore was key to ComEd’s success over the years in Springfield. Exelon and ComEd have one of the largest lobbying contingents at the Capitol and historically have been among the biggest campaign contributors to state lawmakers.

Pramaggiore spokesman Bryan Locke declined to comment on whether she is cooperating with federal authorities. “Ms. Pramaggiore has done nothing wrong and any inference to the contrary is misguided and false,” Locke said in a statement.

“During her tenure, she and other current and former ComEd and Exelon executives received, evaluated and granted many requests to provide appropriate and valuable services to the companies, none of which constitute unlawful activity,” Locke wrote.

The prosecutors’ filing states that certain other ComEd leaders were aware of the payments meant to influence Madigan, at least in part because McClain spelled them out. One of the payrollers of the unnamed company involved in the scheme was in the Madigan political operation, McClain allegedly explained in a conversation federal officials quoted in the document.

The person being paid was “one of the top three precinct captains,” who “trains people how to go door to door … so just to give you an idea how important the guy is,” McClain said, according to prosecutors.

Another example cited by authorities involved a man identified in the federal material as “Consultant 1,” who allegedly was speaking to a ComEd executive identified by the Tribune as Fidel Marquez. The consultant said he believed McClain had spoken to Madigan about the payments, saying the money was “to keep (Public Official A) happy (and) I think it’s worth it, because you’d hear otherwise,” prosecutors alleged.

The federal filing also alleged ComEd hired an unnamed law firm because the utility’s executives knew it was important to Madigan, and that ComEd would accept students from the speaker’s 13th Ward into an internship program as a way to “influence and reward” Madigan.

In addition, prosecutors said that in 2017, the speaker sought the appointment of an associate to ComEd’s board of directors. ComEd and Exelon did due diligence on the associate and found him qualified, though no one had recruited him for the board and ComEd did not seek other candidates, prosecutors wrote. The Tribune has identified that person as Juan Ochoa, a former McPier CEO who was appointed to the utility’s board but is no longer listed as being on it.

McClain again communicated the alleged Madigan desire to Pramaggiore, the complaint states, not using their names. “You take good care of me and so does our friend (Public Official A) and I will do the best that I can to, to take care of you,” Pramaggiore allegedly said, before later informing McClain the appointment had taken place.

Ochoa could not be reached for comment.

In an interview with the Tribune, Exelon CEO Christopher M. Crane said: “We take this seriously and we corrected it. It should never happen and it won’t happen again.” He said that he believed that everyone who “orchestrated any of that behavior” had left ComEd.

The agreement with federal prosecutors says ComEd can’t seek a tax deduction in relation to the fine and can’t recoup it through “surcharges, fees or any other charges to customers.” Crane said Exelon would give ComEd the money to pay the fine, and then ComEd would pay Exelon back from its profits.

The federal filing says authorities could have fined ComEd between $240 million and $480 million, but the utility got a “discount” off the bottom of that range for “substantial remediation and cooperation.” Half the money is due in a month and the other half in three months.