SEC Clears Davis Aide, 2 Consultants of Energy Stock Wrongdoing

The press secretary for Gov. Gray Davis and two state energy consultants have been cleared of wrongdoing by the U.S. Securities and Exchange Commission.

The three had been under investigation over possible security fraud violations for buying or selling energy company stock last year.

“This investigation has been terminated, and no enforcement action has been recommended to the Commission,” wrote Robert L. Mitchell, SEC assistant district administrator, in a July 11 letter to Davis Press Secretary Steven Maviglio.

The SEC also informed Vikram Budhraja and Mark Skowronski, both employees of Electric Power Group, that no enforcement action will be taken against them. Stephen Kaufman, the Los Angeles attorney for Budhraja and Skowronski, said he received a letter from the SEC on Monday.

Pasadena-based Electric Power Group won a $6.2-million contract last year to assist the Department of Water Resources in buying electricity for millions of customers of utilities crippled by the electricity crisis.

Budhraja still works for the state as a consultant. Skowronski was reassigned in December.

Public disclosure forms filed by state energy consultants in the summer of 2001 showed that Budhraja and Skowronski bought multiple blocks of Edison International stock worth tens of thousands of dollars in January 2001, just before Electric Power Group won its state contract to help the state buy electricity for Edison, Pacific Gas & Electric and San Diego Gas & Electric customers.

In May 2001, Maviglio purchased stock in Calpine Corp., a San Jose-based power plant builder that had signed a multibillion-dollar, long-term contract with the state in February. Maviglio sold the stock, which was valued at $10,000 to $100,000, in August 2001.

After a 10-month investigation, state Atty. Gen. Bill Lockyer in May cleared state electricity buyers and consultants of any criminal conflict of interest charges. There was no evidence that the power buyers held significant stock or other financial interests in the energy companies with which they did business, he said.

Secretary of State Bill Jones had urged the attorney general and SEC to probe possible violations by Davis administration consultants.