"JPMorgan Chase developed schemes to sell electricity at falsely attractive prices in Michigan and California, according to The New York Times. The market manipulation could result in JPMorgan Chase receiving penalties from the Federal Energy Regulatory Commission."
"JPMorgan Chase is reportedly accused of manipulating energy prices to make money-losing power plants seem profitable.
Between 2010 and 2011, JPMorgan Chase sold electricity to authorities in California and Michigan at prices “calculated to falsely appear attractive,” reads a confidential government document acquired by The New York Times.
The alleged market manipulation cost the states $83 million in excess payments.
The nation's largest bank could face stiff penalties from the Federal Energy Regulatory Commission (FERC), a low-profile agency charged with regulating the sale of electricity. FERC has not yet made a public statement about the investigation, but analysts suggest the regulator is likely to pursue charges. Call it the 'Enron effect.'
'In 2001, FERC acted as if market manipulation was a sort of boys-will-be-boys situation,' Frank Lindh, general counsel at the California Public Utilities Commission (CPUC), said in a telephone interview. 'Now, they seem to be taking it more seriously.'"
David J. Unger reports for the Christian Science Monitor May 6, 2013.
SEE ALSO:
"JPMorgan Caught in Swirl of Regulatory Woes" (New York Times/DealBook)
"Scrutiny Falls on a Pioneer at JPMorgan" (New York Times/DealBook)
"JPMorgan Runs Afoul of Energy Authorities" (New York Times/DealBook)
"JPMorgan Directors Feel Heat in a Vote" (New York Times/DealBook)
"Finding Fault With JPMorgan’s Directors" (New York Times/DealBook)
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