SEC Charges SCANA Corp., Two Former SCANA Top Executives, and SCE&G With Defrauding Investors
Kehoe Law Firm, P.C. is making investors aware that on February 27, 2020, the SEC announced that it charged SCANA Corp., two of its former top executives, and South Carolina Electric & Gas Co. (SCE&G), now known as Dominion Energy South Carolina Inc., with defrauding investors by making false and misleading statements about a nuclear power plant expansion that was ultimately abandoned.
The SEC’s complaint alleges that SCANA, its former CEO Kevin Marsh (“Marsh”), former Executive Vice President Stephen Byrne (“Byrne”), and subsidiary SCE&G misled investors about a project to build two nuclear units that would qualify the company for more than $1 billion in tax credits. According to the complaint, the defendants claimed that the project was on track even though they knew it was far behind schedule, making it unlikely to qualify for the tax credits. The SEC’s complaint also alleges one SCANA executive said that officers of the company “flew around the country showing the same . . . construction pictures from different angles and played our fiddles” while the project itself “was going up in flames.” SCANA abandoned the project in mid-2017 with neither nuclear unit completed. The SEC’s complaint alleges that the false statements and omissions enabled SCANA to boost its stock price, sell more than $1 billion in bonds, and obtain regulatory approval to raise customers’ rates to finance the project.
The SEC’s complaint charges SCANA, SCE&G, Marsh, and Byrne with violations of the antifraud provisions of the federal securities laws, and charges SCANA, SCE&G, and Marsh with reporting violations. The complaint seeks a permanent injunction, return of allegedly ill-gotten gains along with prejudgment interest, and financial penalties from all defendants, and an officer and director bar against Marsh and Byrne.