The Utility's Actions to Disclose and Rectify a Violation: Utilities are expected to promptly bring a violation to the Commission's attention. What constitutes "prompt" will depend on circumstances. Steps taken by a utility to promptly and cooperatively report and correct violations may be considered in assessing any penalty.
We have imposed a fine of $30 million rather than a larger fine because of SCE's excellent cooperation after the fraud and manipulation came to light. A penalty must take into account the scope of a utility's investigatory efforts, level of self-reporting and cooperation, and corrective measures, to avoid the unintended consequence of discouraging such behavior in the future, for the utility being penalized as well as other utilities. We expect and demand cooperation and will reward it appropriately. On March 8, 2004, SCE voluntarily met with the Commission's General Counsel to notify the Commission of its initial findings and SCE's continuing investigation. On March 15, 2004, SCE sent a letter to the Commission President Michael R. Peevey advising him of the ongoing investigation. On May 25, 2004, SCE met again with the Commission to provide it with additional information and a status report on the investigation. SCE waived its attorney-client privilege with respect to its investigation report and interview notes. SCE cooperated in CPSD's investigation.
SCE's Exhibit 11, its PBR Customer Satisfaction Investigation Report, and Exhibit 12, its PBR Illness and Injury Record Keeping Investigation Report are models of thoroughness and cooperation. SCE launched a comprehensive investigation after receiving information that its PBR data might be inaccurate. It spent a great deal of money, time, and effort to review thoroughly all PBR programs - not just the ones for which allegations had been made. It promptly reported the possibility of wrongdoing to the Commission, and worked with Commission staff to develop its investigation keeping staff fully informed. It waived applicable privileges and released to Commission staff memoranda summarizing the interviews of SCE personnel.
SCE points out that encouraging corporate entities to be thorough in their investigatory efforts, to self-report, and to cooperate in a regulatory or governmental investigation has been increasingly recognized as being in the public interest. For example, in 2005, FERC issued a policy statement providing guidance on the enforcement of its statutes, orders, rules and regulations.14 In the policy statement, FERC discussed, at length, the importance of considering "what efforts the company made to remedy the violation in a timely manner," including internal compliance, self-reporting, and the corporation's level of cooperation.15
14 FERC, Policy Statement On Enforcement, Docket No. PL06-1-000 (October 20, 2005).
15 Id. at 10-12.
