Judge tosses out indictment against last defendant in SCANA nuclear fraud case
A federal judge on Wednesday dismissed a major white collar fraud case against the last remaining defendant in the government’s prosecution of crimes in the doomed effort by former South Carolina utility giant SCANA to build two multi-billion dollar nuclear plants in Fairfield County.
In an unexpected filing, Judge Mary Geiger Lewis tossed out the case against former Westinghouse top executive Jeffrey Benjamin, saying that the grand jury that brought a superceding indictment in the case against Benjamin was potentially biased, since some members of that grand jury were SCANA ratepayers and described as victims in the government’s case against Benjamin.
Lewis dismissed the case “without prejudice,” meaning the government could go back and seek to re-indict Benjamin, this time with an unbiased jury. In her order, Lewis referred to a federal statute that sets forth a time frame that the government has to re-initiate charges.
Assistant U.S. Winston Holliday, one of the prosecutors on the case, indicated Thursday the matter is not over. “We are not walking away from the case.”
Benjamin attorney William Sullivan of Washington, D.C., said, “We are very gratified by Judge Lewis’s lucid and articulate ruling, properly finding under the facts and the Constitution that Mr. Benjamin’s unequivocal Fifth Amendment right to an unbiased grand jury was compromised in this case. We also applaud her recognition that while dismissal is rare, it is also required in matters such as this one where such an extreme Constitutional violation occurred.”
Jeffrey Benjamin was to have gone on trial in October in Greenville. The trial had been moved from Columbia to an area that was not served by SCANA, the former power company that was taken over by Dominion Energy.
“Although the grand jurors were told at orientation they could decline to participate in a particular case if they felt they were unable to remain impartial, it appears the government failed to identify and recuse those grand jurors who were ratepayers,” Lewis wrote in her seven-page order.
“The Fifth Amendment (to the U.S. Constitution) guarantees the right to indictment by an unbiased grand jury,” she wrote. “Benjamin is entitled to a grand jury free from his alleged victims.”
Benjamin, a former senior vice president for Westinghouse, was originally indicted on mail fraud charges in August 2021 by a federal grand jury in Columbia. He was accused of helping former SCANA officials hide major workplace problems from 2015 to 2017 at SCANA’s nuclear plant construction project at the V.C. Summer site in Fairfield County. He was re-indicted last February.
Westinghouse had contracted with SCANA and Santee Cooper, the state-owned utility that was a junior partner in SCANA’s flawed nuclear venture, to build two nuclear plants north of Columbia. Once construction began, SCANA hiked monthly bills of its ratepayers to pay for ongoing construction that was managed by Westinghouse.
Basically, the fraud alleged by prosecutors concerned a cover-up by former SCANA executives to hide the extent of construction problems at the nuclear site, problems that were causing billions of dollars in losses from cost overruns and flaws in the building of the plants.
The motive for hiding the severe financial problems at the site was to keep the stock of SCANA, which was publicly traded on the New York Stock Exchange, up high, prosecutors charged.
The failure of SCANA and Westinghouse to complete the nuclear plants in Fairfield County, a surprise development announced in July 2017, threw thousands of people out of work and led to a buyout of SCANA, once one of South Carolina’s most successful companies, by Dominion Energy.
In his job, Benjamin oversaw Westinghouse’s new plants and major projects.
Lewis said that Benjamin didn’t need to demonstrate any actual bias for her to dismiss the indictment.
“To protect the law as an institution, the community at large, and the democratic ideal reflected in the processes of our courts, the Court must take all necessary steps, including, in this case, dismissal of the indictment,” she wrote.
Two former SCANA top executives — former CEO Kevin Marsh and former chief operating officer Stephen Byrne — pled guilty to fraud and were given prison terms. Marsh received two years in federal prison and Byrne, 15 months.
