U.S. accuses JPMorgan: Bank pays $410 million settlement
U.S. accuses JPMorgan: Federal Energy Regulatory Commission says JPMorgan traders manipulated electricity prices. JPMorgan Chase & Co. agreed to pay $410 million on Tuesday to settle the claim by U.S. energy regulators.
The Federal Energy Regulatory Commission said the bank used improper bidding strategies to squeeze excessive payments from the agencies that run the power grids in California and the Midwest. The improper conduct occurred between September 2010 and November 2012, FERC said.
JPMorgan, the biggest U.S. bank, is paying a civil penalty of $285 million and returning $125 million in allegedly improper profits.
FERC said its investigation had found improper trading practices were used at Houston-based JPMorgan Ventures Energy Corp.
New York-based JPMorgan said in a written statement that it's "pleased to have reached an agreement with FERC to put this matter behind it." JPMorgan didn't admit or deny any violations.
The move is part of a broad crackdown by FERC on alleged price manipulation. FERC recently levied a $453 million penalty on Barclays, Britain's second-largest bank, for manipulating electricity prices in California and other Western states. Barclays is disputing the allegations.
FERC claimed JPMorgan's energy unit used five "manipulative bidding strategies" in California between September 2010 and June 2011, and three in the Midwest from October 2010 to May 2011.