AEP Settles SEC Probe with $19M Fine in Ohio Scandal

COLUMBUS, Ohio — American Electric Power (AEP) has agreed to pay a $19 million fine to the U.S. Securities and Exchange Commission (SEC) to resolve allegations of misleading investors about its involvement in Ohio’s House Bill 6 scandal. The settlement, announced Friday, stems from AEP’s financial support for a nonprofit tied to former Ohio House Speaker Larry Householder, who is now serving a 20-year prison sentence for his role in the corruption scheme.

The Columbus-based utility company acknowledged it received subpoenas from the SEC in May 2021 and August 2022 related to its activities surrounding the controversial legislation. House Bill 6, passed in 2019, initially aimed to provide a $1.3 billion bailout for Ohio’s two nuclear power plants and subsidies for coal-fired plants, including one in Indiana. The nuclear bailout was later repealed following public outcry and a criminal investigation.

According to the SEC’s order, AEP contributed $350,000 to Empowering Ohio’s Economy Inc., a group that funneled $150,000 to Generation Now, a nonprofit central to the corruption case. Generation Now received $60 million from FirstEnergy Corp., the former owner of the nuclear plants, to secure the bill’s passage. The SEC found that AEP controlled Empowering Ohio’s spending to further its own interests, with the group contributing $1.2 million to organizations linked to Householder.

In March 2020, AEP’s then-CEO Nicholas Akins and an employee met with Householder at the company’s headquarters. During the lunch meeting, Householder discussed a term-limit initiative that would allow him to remain speaker for an additional 16 years. Shortly after, AEP directed Empowering Ohio to contribute $500,000 to a newly created 501(c)(4) organization supporting the initiative.

“AEP fully cooperated with the SEC throughout this process and previously implemented additional safeguards in this area,” the company said in a statement. “Resolving this issue is an important step for AEP. We look forward to putting this matter behind us and fully focusing on making needed investments to enhance the service we provide to our customers.”

The settlement does not require AEP to admit or deny the SEC’s findings. The company had previously set aside $19 million in November 2023 to cover potential claims tied to the investigation. While AEP has not faced criminal charges, Householder and former Ohio Republican Party Chairman Matt Borges were convicted and sentenced to 20 and five years in prison, respectively.

FirstEnergy Corp., another key player in the scandal, previously settled with the SEC for $230 million over similar allegations of misleading investors about bribes paid to Householder. The House Bill 6 scandal remains one of the largest corruption cases in Ohio history, with ongoing legal and political ramifications.