Siemens Energy, Inc., pleaded guilty today in the Justice Department’s criminal investigation into trade secrets surrounding bids for Dominion Energy’s “Peaker” combustion turbine plant planned in the Greater Richmond area.
Siemens will pay $104 million to resolve the issue and agreed to a three-year term of organizational probation.
Dominion opened a competitive, closed bid process for soliciting requests for proposals from companies in 2019. Three companies bid for the work: General Electric Company, Mitsubishi Heavy Industries, Ltd., and Siemens.
After GE and MHI submitted their bids to Dominion, an account manager at Siemens coordinated with a Dominion insider to obtain information on the alternate bids. After reviewing the confidential bids, Siemens resubmitted a lower bid to undercut the competitors.
Siemens won the bid with Dominion with a price tag estimated at $500 million. The plant was put on hold after the passage of the Virginia Clean Economy Act in 2020 which requires Dominion to be 100 percent carbon free by 2045.
“Corporate accountability remains a top priority for the Department of Justice,” said Jessica D. Aber, a U.S. Attorney for the Eastern District of Virginia. “The actions of these defendants undermined the integrity of the competitive marketplace, harming both competitors and consumers. The department has established whistleblower programs to encourage corporations and individuals to come forward with timely information regarding misconduct and criminal behavior. Failing to do so invites prosecution and serious consequences.”
Siemens Energy Inc. is scheduled to be sentenced on Dec. 5.
“The agreement between Siemens Energy Inc. and the U.S. Department of Justice, which is subject to final approval by the court, resolves a matter related to the misconduct of former employees which took place more than five years ago. The company proactively discovered the conduct in 2020 and voluntarily disclosed it to its customer and two affected competitors whose claims it subsequently settled,” Siemens said in a statement.
“SEI also investigated the matter extensively with the assistance of a prominent law firm and has cooperated fully with the U.S. government investigation. It took disciplinary action against several individuals, including separation and has further enhanced the company’s already-strong compliance program. SEI is committed to the highest standards of integrity and compliance, and the aberrant conduct that occurred in this case does not reflect who we are as a company.”
The company’s plea comes after four involved in the scheme entered guilty pleas for their roles in the criminal misconduct.
Siemens is a U.S.-based subsidiary of a Germany-based global manufacturing conglomerate, Siemens Energy AG, whose technology is responsible for one sixth of electricity production worldwide.
The fallout: Prison for those involved
In November, John Gibson, 58, of Winter Park, Fla., pleaded guilty to conspiracy to convert trade secrets. He was sentenced to three years and seven months in prison.
Michael Hillen and Theodore Fasca each pled guilty to conspiracy to commit wire fraud and were sentenced to three years and one month in prison.
Mehran Sharifi pled guilty to conspiracy to convert trade secrets and is scheduled to be sentenced Oct. 11. He faces a maximum penalty of 10 years in prison.
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Crystal Graham
