Superior, Colorado – Andrew K. Richmond, 43, has been penalized for manipulating natural gas prices while employed at Western Gas Resources, Inc., according to a consent order entered on March 20, 2007, by the U.S. District Court for the District of Colorado. The U.S. Commodity Futures Trading Commission (CFTC) brought the charges against Richmond.
The court found that between April 2000 and February 2001, Richmond pressured traders under his supervision to submit false information – including fabricated price and volume data – to Gas Daily, a key compiler of natural gas price indexes. The intent was to benefit positions held by Western Gas Resources, Inc.
As a result of the settlement, Richmond will pay a $60,000 civil monetary penalty. Furthermore, he is permanently barred from registering with the CFTC, engaging in any activity requiring registration, or acting as a principal with any registered entity. He is also prohibited from directly or indirectly trading on or subject to the rules of any registered entity.
The CFTC’s lawsuit, initially filed on April 12, 2005, alleged that at least two traders Richmond supervised ultimately submitted the false trade information to Gas Daily. Gregory Mocek, CFTC Director of Enforcement, emphasized that providing false information to index compilers is a violation of federal law, despite the lack of day-to-day regulation of the indexes themselves.
This case is part of a larger effort by the CFTC to address alleged wrongdoing in energy markets. To date, the agency has filed 35 enforcement actions, resulting in over $307 million in penalties. The Department of Justice has also filed 18 criminal cases related to energy market misconduct since 2002, in cooperation with the CFTC.
The case was led by CFTC staff members Michael J. Otten, Judy T. Lee, Lacey Dingman, Gretchen L. Lowe, and Vincent A. McGonagle.
Source: CFTC.gov
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