Nicor Inc. has been informed by the Securities and Exchange Commission (SEC) that it plans to bring civil charges against the company stemming from the questionable accounting practices at its retail energy joint venture with Dynegy Inc.

In a filing at the SEC Monday, the Naperville, IL-based company said the SEC Enforcement Division advised Nicor Energy, the Dynegy-Nicor joint venture, on Jan. 28 that it would recommend civil charges against it for violations of the Securities Exchange Act of 1934. The SEC also has been investigating the alleged improper activities of affiliate Nicor Gas relating to its performance-based rate (PBR) program, but it was not clear if the agency would recommend charges in this area as well.

Nicor stock plunged 12.41% ($3.38) Monday in the wake of the company’s SEC filing, with shares closing at $23.85.

The Office of the United States Attorney for Northern Illinois also has notified Nicor that it is conducting an investigation into the same matters that the SEC is reviewing, and that a grand jury is looking into the case.

Nicor Energy was a retail energy alliance that provided energy services for industrial, commercial and residential customers in the Midwest. Nicor and Dynegy each had a 50% interest in the company.

As for the PBR program, Nicor has been accused of engaging in improper conduct that led to gas customers being overcharged millions in gas costs. An independent board, commissioned by the company, last October found no evidence of criminal fraud on the part of affiliate Nicor Gas, but it did acknowledge that Nicor Gas overcharged customers by an estimated $15 million over the past couple of years.

But critics of Nicor Gas, such as the Citizens Utility Board (CUB) in Illinois, blasted the findings, saying that they masked the full extent of Nicor Gas’ wrongdoing and the amount of overcharges owed to state gas consumers.

Last week, Nicor restated nearly four years of financial results, dropping its earnings by $20.6 million over the period and lowering its profit for the fourth quarter of 2002 by 17%, in an attempt to resolve many of the accounting errors.

At the same time, Nicor CEO Thomas Fisher vowed to do whatever is required to complete the ongoing federal and state investigations into the company.

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