Barclays Hits Out At Proposed Record Fine For Alleged Energy Trading Abuses

Bloomberg reports that the Federal Energy Regulatory Commission issued an order Wednesday directing the London-based bank to show why it shouldn’t have to pay a $435m civil penalty and give up $34.9m in profit for allegedly gaming markets in the western U.S. from late 2006 to 2008. The FERC also proposed an individual penalty of $15m for trader Scott Connelly and $1m each for three colleagues.

'We are disappointed by the action that FERC took today and strongly disagree with the allegations made by FERC against Barclays and its former trades', Mark Lane, a Barclays spokesman, said in an e-mailed statement. 'We believe that our trading was legitimate and in compliance with applicable law'.

Barclays said Wednesday that it is also the subject of separate probes by the U.S. Justice Department and Securities and Exchange Commission. The agencies are trying to determine whether third parties who help the bank win business comply with the Foreign Corrupt Practices Act. In June, U.K. and U.S. regulators fined Barclays for manipulating the London interbank offered rate.

The FERC order is part of a drive by the agency to combat manipulation in energy markets, where utilities and generators buy and sell electricity. The agency, which also is probing trading by JPMorgan Chase & Co. (JPM) and Deutsche Bank AG (DBK), in February created a division in its enforcement office to police the markets.

Hit the link below to access the complete Bloomberg article:

U.S. Proposes Record Penalty for Barclays’ Energy Trades

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