For Release: September 27, 2006
Dominion Resources, Inc. Agrees to Pay a $4.25 Million Civil Penalty to Settle U.S. Commodity Futures Trading Commission Charges of False Reporting
False Reporting of Natural Gas Transactions to Gas Daily, Inside FERC, and Natural Gas Intelligence Spanned Nearly Two Years
Washington, D.C.— The U.S. Commodity Futures Trading Commission (CFTC) announced today the issuance of an administrative order instituting and simultaneously settling charges under the Commodity Exchange Act (CEA) against Dominion Resources, Inc. (Dominion). Dominion agreed to pay a $4.25 million civil monetary penalty to settle charges of false reporting of trade information concerning natural gas transactions in violation of the CEA.
The order finds that, from at least December 2000 through November 2002, several traders on Dominion’s natural gas trading desks knowingly reported false, misleading and knowingly inaccurate natural gas trading information, including price and volume information, to Gas Daily, Inside FERC, and Natural Gas Intelligence. According to the order, the reports contained both fictitious trades and certain actual trades in which the prices and/or volumes were altered, as well as selected trades observed in the market, all of which were represented to be Dominion’s actual trades.
The order explains that reporting firms including Gas Daily, Inside FERC, and Natural Gas Intelligence use price and volume information collected from participants like Dominion to calculate indexes of natural gas prices for various hubs throughout the United States. According to the order, participants in the natural gas markets use these indexes to price and settle commodity transactions, and natural gas futures traders refer to the published indexes for price discovery and for assessing price risks.
In addition to imposing civil penalties, the CFTC order requires Dominion to comply with certain undertakings, including providing future cooperation to the CFTC.
The Division of Enforcement appreciates the cooperative enforcement efforts of the Richmond Division of the Federal Bureau of Investigation, and the United States Attorney’s Office of the Eastern District of Virginia in the investigation of this matter.
The following CFTC Division of Enforcement staff were responsible for this case: Michael Solinsky, Anthony M. Mansfield, Maura M. Viehmeyer, Lacey Dingman, Laura Gardy, Joseph F. Vargyas, Gretchen L. Lowe, Vincent A. McGonagle, and Richard B. Wagner.
Last Updated: July 26, 2007