COLUMBUS — A federal judge must use his sentencing later this week of two former political powers engaged in the largest bribery scandal in state history to send a message to others in Ohio’s politics who continue to use legal “dark money” entities to achieve their goals, prosecutors argue.
Larry Householder, a two-time speaker of the Ohio House of Representatives, and Matt Borges, former head of the Ohio Republican Party, both face a maximum of 20 years in federal prison for their racketeering conspiracy convictions tied to a $61 million bribery scheme primarily fueled by Akron utility giant FirstEnergy Corp.
“Despite the jury’s verdict in this case, 501(c)(4s) (non-profit corporations) remain a tool for Ohio politicians to receive unlimited payments — which are hidden from the public’s view — and potential vehicles for bribery,” the U.S. Attorney’s office wrote. “The court should thus consider the need for general deterrence, here, given the widespread risk of politicians misusing 501(c)(4)s for their personal benefit.
“This risk appears particularly prevalent in Ohio,” the prosecution wrote.
U.S. District Court Judge Timothy Black will sentence Householder, described by prosecutors as the “quintessential mob boss,” on Thursday and Borges on Friday in the Cincinnati courtroom where a jury convicted them in March after a seven-week trial.
Whatever happens this week, both men maintain their innocence and plan to appeal their convictions.
Although the two men were convicted of the same crime, the U.S. Attorney’s office is recommending very different levels of punishment. This is because of their different roles in a scheme through which FirstEnergy successfully sought to return Householder to the speaker’s podium so that he would usher through and then protect a $1 billion, consumer-paid bailout of two struggling nuclear power plants then owned by a FirstEnergy subsidiary.
The prosecution is asking for between 16 and 20 years for Householder, 61, compared to five to eight years for Borges, 52.
In contrast, Householder suggests 12 to 18 months while a year and a day is Borges’ goal.
“The scope of Householder’s corrupt scheme — in terms of the millions of dollars received by the enterprise, and the significance of the nuclear-bailout legislation passed in return — is breathtaking,” the prosecution wrote. “Also troubling, however, was evidence suggesting those in power knew about Householder's and FirstEnergy’s corruption and did nothing while it was happening, leaving Bob and Betty Buckeye in the dark.”
Householder attorneys Steven Bradley and Nicholas Oleski countered that the former speaker, until now, had led an “exemplary life” of public service and that he has already lost his reputation.
“Mr. Householder is a broken man,” his attorneys wrote. “He has been humiliated and disgraced. All of the goals of sentencing — punishment, specific deterrence, general deterrence — have been achieved. Nothing will be accomplished by imposing a Guidelines sentence — which is likely to be a life sentence.”
Borges turned down a six-month offer from the prosecution but now faces potentially eight years. His role occurred chiefly during the latter months of the scheme when attention turned to killing a petition effort that could have led to voter repeal of House Bill 6, the bailout law.
The jury heard how Borges used conduit money to pay a $15,000 bribe to a manager on the repeal petition effort, seeking inside information on the effort's progress and strategy.
The strategist went to the FBI and wore a wire to obtain recordings of his conversations with Borges.
Although his primary role came late, the prosecution contends Borges “enthusiastically” forwarded the scheme and was “all in,” personally benefiting to the tune of $360,000 from some of the FirstEnergy money flowing through the dark money pipeline, it contends.
“Borges was the mastermind behind the solicitation and bribe of Tyler Fehrman ...,” the prosecution said. “Borges came up with the idea; Borges set up the meeting with Fehrman; Borges offered Fehrman money for information on Sept. 2, 2019; and Borges sealed the deal.”
The prosecution noted Borges had called the Householder-FirstEnergy relationship an “unholy alliance.”
“He described the corrupt payments from FirstEnergy to Householder as ‘Monopoly money at this point in time, you know, it’s like not real,’” the prosecution wrote. “Borges told Fehrman, ‘People are going to get fat off of this. ... So why the [expletive] not us.’”
This was also not Borges’ first criminal conviction. He pleaded guilty and paid a $1,000 fine in 2004 to a misdemeanor charge of improper use of public office when he was chief of staff to then Ohio Treasurer Joe Deters, now an Ohio Supreme Court justice. He later had the conviction expunged and made a high-profile comeback by becoming chairman of the state GOP.
Borges, in turn, noted that two other conspirators who played larger and longer roles — political strategist and Householder ally Jeff Longstreth and then FirstEnergy Solutions lobbyist Juan Cespedes — expect to get sentences of zero to six months. They pleaded guilty to the same charge and testified at trial.
“While our system favors resolution by plea agreement, and cooperation with the government, a 240-month sentence for Borges is grossly disproportionate to the sentences Longstreth and Cespedes hope to receive,” Borges attorney Karl Schneider wrote.
First Published June 26, 2023, 7:55 p.m.
