Ten points to remember for compliance and employee training.
Without a clear definition of market manipulation, or a detailed description for prohibited conduct, market participants are often left with more questions than answers.
Are regulators managing market manipulation?
Some will stray from ethical behavior. But markets must be regulated to maintain confidence.
Law, compliance, and case management – plus the blurred boundary between FERC and CFTC.
In the aftermath of 2000-2001 energy crisis, Congress provided federal regulators more authority to crack down on fraud. To do so, FERC must show that the actor possessed the requisite state of mind and establish a connection between the alleged manipulative action and an interstate transportation or sale for resale of natural gas or electricity.
FERC and CFTC begin sharing information to target market manipulation in the energy industry.
Closer coordination between FERC and CFTC (and perhaps also with DOJ) will increase enforcement risk for energy industry traders.