Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Energy Markets Face Expanded Enforcement
Following the Enron bankruptcy and West Coast energy crisis of 2001-2002, Congress gave the Federal Energy Regulatory Commission (FERC) more powerful enforcement tools to prevent unlawful and manipulative activities in energy markets. The Energy Policy Act of 2005 (EPACT) gave FERC the authority to assess penalties under the Natural Gas Act and Federal Power Act of up to $ 1 million per day per violation. See 15 U.S.C.A. ' 717t-1; 16 U.S.C.A. ' 825o-1. FERC has expanded its Office of Enforcement, called for heightened industry compliance programs and self-disclosure of misconduct, and is newly focused on enforcement rather than on traditional ratemaking. Two years into the EPACT era, FERC has used its newly acquired authority vigorously:
- In July 2007, FERC issued proposed penalties and disgorgement remedies in two different proceedings (Amaranth and Energy Transfer Partners) totaling $458 million, for alleged market manipulation and other violations.
- FERC's action in Amaranth included proposed penalties against two individual energy traders totaling $32 million.
- Since January 2007, FERC has approved 12 consent agreements to terminate enforcement investigations, which collectively required payments of more than $40 million in penalties and disgorgements.
Major questions remain about FERC's enforcement policies, including: the scope of FERC's jurisdiction; the scope of the penalties to be associated with particular violations; and whether respondents facing penalty awards are entitled to a de novo hearing in district court. FERC has also not indicated whether it will exercise its long-standing authority to refer willful violations of its major statutes to the Department of Justice (DOJ) for criminal prosecution, particularly given that the potential monetary penalties and terms of imprisonment were significantly increased under EPACT. However, FERC's actions under EPACT suggest some benchmarks for companies active in the energy industry seeking to avoid or minimize liability under this new regime.
The Far Reach of EPACT Jurisdiction
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.