FERC and CFTC begin sharing information to target market manipulation in the energy industry.
Steven F. Reich and Charles F. Connolly are partners in the Investigations Practice Group at Akin Gump Strauss Hauer & Feld LLP and former senior officials at the U.S. Department of Justice. J. Porter Wiseman is a Senior Attorney in the firm’s Energy Regulation, Markets and Enforcement practice.
In 2005, Congress broadened enforcement authority at the Federal Energy Regulatory Commission (FERC) to reach the use of "any manipulative or deceptive device or contrivance" in connection with natural gas and electricity trading that is subject to FERC regulation.1 Since then, FERC has significantly expanded its Office of Enforcement and has sent a strong signal that it intends to wield its new authority aggressively. Until recently, however, its enforcement efforts had been hampered by jurisdictional disputes with the Commodity Futures Trading Commission (CFTC) and, moreover, by the CFTC's reluctance to share with FERC its sophisticated Large Trader Reporting System ("LTRS") database containing detailed information on the futures, options, and swap positions of traders that exceed certain position limits or volume thresholds.2