June 4, 2015
Review of Allegations of Improper Disclosure of Confidential, Nonpublic Federal Energy Regulatory Commission Information
The Federal Energy Regulatory Commission (Commission or FERC), an independent regulatory agency officially organized as part of the Department of Energy, is composed of five Commissioners (including a Chairman). The Commission's Office of Enforcement (OE) seeks to encourage compliance with energy-related statutes, rules, and orders. The Chairman and Commissioners are kept apprised of all OE investigative cases and must provide their approval prior to key enforcement actions being implemented. According to Commission regulation, virtually all of the information gathered during the course of an investigation is nonpublic.
On March 9, 2015, Mr. Jon Wellinghoff, who served as Commission Chairman from 2009 to 2013, moderated a panel discussion at a public conference at which he shared a video excerpt of a nonpublic deposition taken during a major OE investigation. At the time of the investigation, Mr. Wellinghoff was FERC's chair. Subsequent to the March 9 event, a Commission employee and an attorney for the energy trading firm which was the subject of the OE investigation expressed concerns to the Commission that the disclosure may have been unauthorized and in violation of Federal law and regulation. Because of the potential for harm associated with the unauthorized disclosure, on March 24, 2015, the matter was referred to the Office of Inspector General by the Commission's Designated Agency Ethics Official.
We confirmed the essence of the allegation, finding that Mr. Wellinghoff had, in fact, disclosed nonpublic OE information in a public setting. We concluded that the disclosure of such information could threaten the integrity of FERC's regulatory and enforcement processes. We found that when advised of the matter, Commission staff took steps to restrict further public disclosure of the video excerpt by Mr. Wellinghoff and conference organizers. However, we determined that additional actions are necessary to preclude improper disclosures of confidential, nonpublic information in the future.
The issues outlined in this report relate primarily to the conduct of the former Chairman. However, we also found that there were inconsistencies and weaknesses in the Commission's postemployment guidance and exit process. As a result of this latest incident, Commission attorneys stated they are taking steps intended to enhance postemployment guidance and improve the exit process, which should further inform departing employees, Commissioners included, of how to handle nonpublic information they had access to during their time at the Commission.
Topic: Management & Administration