Large corporatations like PG&E often get away with commiting crimes at the expense of the average citizen because of the power that they have. It is the federal prosutors job to ensure that these corportations get treated the same as everyone else regardless of the power that they have and wield.
Yes, federal prosecutors are in the wrong for slashing potential fines against PG&E. I believe that a 6 million dollar fine, reduced from 562 million sends a message to PG&E as well as other energy corporations that they are above the law and that in the interest of preserving the status quo strict measures of enforcement will not be levied against them.
The federal judge agreed to slash potential fines after the prosecutors requested it. It's a huge cut for one of the worst utility disasters in the US. It's possible that an investigation found enough evidence to justify the reduction,but going from $562 million to $6 million is very extreme. 11 pipeline safety violations and a deadly explosion should result in some penalties, and in an explanation for the drastic reduction.
Federal prosecutors have continuously stated that PG&E was negligent in the September 2010 explosion and blast in San Bruno. The prosecutors have built their case against PG&E for years. While I do not believe that it was wrong from them to slash potential fines, it is quite confusing as to why they would decide to do so.