SC House leaders ask SLED to investigate SCANA for fraud

Saying they suspect criminal activity, S.C. House leaders are asking the State Law Enforcement Division to investigate SCANA for possible “criminal fraud” after the Cayce-based utility abandoned two partially built nuclear reactors in Fairfield County.

House Speaker Jay Lucas, R-Darlington, and state Reps. Peter McCoy, R-Charleston, and Russell Ott, D-Calhoun, wrote SLED Chief Mark Keel Monday, requesting an investigation into “potential criminality on the part of SCANA and its principal subsidiary, SCE&G (South Carolina Electric & Gas).”

In the letter, the House leaders said state representatives — who have been investigating the $9 billion Fairfield County debacle — no longer will have any contact with SCANA or SCE&G officials. The lawmakers said they would give SLED information that a House panel has gathered.

That panel, scheduled to meet again Tuesday, is conducting hearings aimed at finding out what went wrong at the nuclear project at the V.C. Summer Nuclear Station.

SLED spokeswoman Kathryn Richardson said Monday that agency had not yet received the House letter.

An SCE&G spokesperson said the company has received the House letter, calling for the SLED investigation, and will cooperate with any federal or state investigation, whether conducted by SLED or any other agency.

The House members are not the first state officials to ask SLED to get involved.

S.C. Attorney General Alan Wilson’s office said Monday that it had asked SLED Friday for help in investigating the nuclear project’s failure, spokesman Robert Kittle said.

SCANA’s stock price was unfazed by the latest news. In trading Monday, SCANA’s stock was up more than $1 a share, bucking a slight drop in U.S. securities markets. Year-today, however, those shares have lost more than 20 percent of their value.

‘Direct result of misrepresentation’

The House panel, with McCoy and Ott as chairman and vice chairman, has been reviewing shortcomings in state law and regulations “that contributed to this economic disaster,” Lucas and the other lawmakers said in the letter.

During testimony and the review of thousands of pages of documents, “it has become our belief that the proximate cause of the V.C. Summer collapse is a direct result of misrepresentation by SCANA and SCE&G. We also believe that criminal fraud through the concealment of material information is also a plausible cause for the project’s disastrous collapse,” the lawmakers wrote.

Lawmakers also are taking heat for a 2007 law that allowed SCANA to charge its power customers for the nuclear reactors, before they went online and started producing power. That law passed overwhelmingly. So far, SCANA customers have paid $1.7 billion for the now-abandoned reactors.

The nuclear project’s failure is under intense scrutiny, including by a federal grand jury and committees in the House and Senate. It also is the subject of several lawsuits.

Senate Majority Leader Shane Massey, R-Edgefield, who co-chairs the Senate committee looking into the Fairfield County project, said it is appropriate for SLED to investigate if there is suspicion that state law has been broken.

However, Massey said he has no plan to make a formal request for SLED to investigate, given the law enforcement agency likely has been paying attention since the utility and junior partner Santee Cooper announced in late July they would abandon the project.

When it meets again Tuesday, the House’s investigative committee will continue to review the role of Santee Cooper, a state-owned utility, in the nuclear project’s failure.

This story was originally published September 25, 2017 at 10:18 AM with the headline "SC House leaders ask SLED to investigate SCANA for fraud."