Householder federal racketeering case set for six weeks

CINCINNATI (AP) — As his federal racketeering trial kicked off Monday, former Ohio House Speaker Larry Householder said he is optimistic and looking forward to telling his side of the story.

“It should be a very good six weeks for me,” Householder told reporters as he awaited opening statements in the courtroom. What will reporters hear? “Truth,” he said, adding that he was not nervous or anxious for the proceeding.

The Perry County Republican, once one of Ohio’s most powerful politicians, is on trial in U.S. District Court in Cincinnati alongside lobbyist Matt Borges, a former chair of the Ohio Republican Party, in what prosecutors have described as the largest corruption case in state history.

A jury must decide whether Householder, 63, and Borges, 50, are guilty of conspiracy to participate in a racketeering enterprise involving bribery and money laundering.

Both have pleaded not guilty and maintain their innocence.

Each faces up to 20 years in prison if convicted.

“Larry Householder sold the Statehouse,” Assistant U.S. Attorney Emily Glatfelter told jurors in the government’s opening statement. “He ripped off the people he was elected to serve and made backroom deals to exchange his power for money.”

An indictment alleges Householder, Borges, three other people and a dark money group called Generation Now orchestrated an elaborate scheme, secretly funded by FirstEnergy Corp., to secure Householder’s power, elect his allies, pass legislation containing a $1 billion bailout for two aging nuclear power plants, and then vex a ballot effort to overturn the bill with a dirty tricks campaign. The arrests happened in July 2020.

Under a deal to avoid prosecution, Akron-based FirstEnergy admitted to using dark money groups to fund the scheme and to bribing the state’s top utility regulator.

Sam Randazzo, at the time the chair of the Public Utilities Commission of Ohio, resigned after an FBI search of his home. He has not been charged and denies wrongdoing.

Two Householder associates, Jeff Longstreth and Juan Cespedes, and a related nonprofit have pleaded guilty to their roles in the scheme described by prosecutors and await sentencing. A third defendant who pleaded not guilty died by suicide.

Householder told reporters he anticipates “redemption.” He said it has been difficult being unable to tell his story in the 2 1/2 years since he was arrested, saying he has spent the time working on his farm, walking in the woods and playing with his 4-year-old granddaughter.

“For a guy like me, who likes to talk? It’s been frustrating,” he said.

As Glatfelter outlined the government’s case against him Monday, Householder, clad in a navy blue suit, at times leaned forward, propped his glasses on his nose and took notes.

Occasionally, he caught a lawyer’s eye and they shook their heads. One of his attorneys was admonished by Judge Timothy Black to “stop the facial expressions” or be relegated to the gallery. “It’s unprofessional. It’s bush league,” the judge scolded.

Glatfelter said the case is not about clarifying federal campaign finance law, as some experts have hoped.

“This is a RICO case,” she said, referring to the federal Racketeer Influenced and Corrupt Organizations Act. “It’s about defendants committing crimes like bribery and money laundering to further their goals.”

Prosecutors plan to use recorded phone calls, text messages, emails, witness testimony and documentary evidence to prove that Householder entered into what one co-conspirator described as an “unholy alliance” with FirstEnergy that amounted to an illegal racketeering scheme, and that Borges played a key role in carrying it out.

The legislation at the heart of the scandal — the Ohio Clean Air Program bill — included a $1 billion bailout for two nuclear power plants, Davis-Besse and Perry, operated at the time by a wholly owned FirstEnergy subsidiary. Surcharges slated to be tacked onto electricity bills statewide to pay for the bailout were eliminated in a partial repeal of the legislation in 2021 and never charged.

Glatfelter said the U.S. plans to begin testimony Tuesday with experts on energy policy, IRS tax-exempt organizations and FBI evidence-gathering. Later witnesses will include an FBI financial analyst; an undercover agent; an informant; Longstreth; Cespedes; lawmakers pressured to vote for the bill; and candidates targeted by “Team Householder,” a group that also went by simply “people at the farm.” The contractor who did work on Householder’s Florida home, which prosecutors allege was paid for with money tainted by the scheme, will also testify.

“The government’s got it wrong,” Householder’s attorney, Steven Bradley, told jurors. He said, “The evidence will show that Larry was never part of a criminal conspiracy.”

The evidence will show, Bradley said, that large sums prosecutors allege Householder raised through bribes and used for personal gain were actually loans from Longstreth that Householder used to settle a lawsuit and repair his Florida home — and promised to repay.

Bradley’s opening statement focused heavily on Householder’s biography — farmer, husband of a schoolteacher, father, insurance agent — until Black urged him to “get to what the evidence will show.”

Bradley said the racketeering scheme described by prosecutors was nothing more than politics as usual, a strategy for advancing Householder’s leadership aspirations by recruiting like-minded lawmakers. He said Householder supported the now-tainted energy bill, known in the Legislature as House Bill 6, purely for policy reasons.

“He believed that HB 6 was legislation that benefited all Ohioans, and that’s the only reason he supported and advanced HB 6,” he said.

Borges’ attorney, Todd Long, said his client was wholly uninvolved in the alleged bribery scheme, because he “was never a member of Team Householder; he was never on the farm.”

“There’s a universe of difference between Matt Borges and everyone else you’re going to hear about in this case,” Long told jurors. “What makes Matt Borges different? Everything, absolutely everything.”