FERC Takes Aim at Barclays Over Power Market Manipulation.
Energy regulators have alleged Barclays PLC and four former electricity traders manipulated the California power markets more than three years ago.
In a public notice of "alleged violations" published on its website on April 5, the Federal Energy Regulatory Commission (FERC) said the UK bank and its four West Coast power traders manipulated the electricity market between November 2006 and December 2008, trading in the physical market in such a way to derive bigger gains on derivative markets.
The notice, which is not a formal charge but suggests the advanced enquiry is likely to move forward, comes just a month after the agency won a record $245 million fine from Constellation Energy over similar trading practices in New York. . .
The notice is one of a dozen or so such market-manipulation investigations the agency has confirmed since January 2011, when it began a controversial policy to pre-announce advanced investigations. Prior to 2011, it successfully concluded only a handful of manipulation cases, two of them related to the $6 billion explosion of hedge fund Amaranth.
The notice also suggested a heightened focus on so-called "loss-leader" trading in which a firm may intentionally seek to sell a physical commodity at a loss in order to reap a much larger profit on related derivative positions.
http://www.nytimes.com/reuters/2012/04/12/business/12reuters-ferc-barclays-manipulation.html?hp
