Amaranth fined $7.5m for market manipulation and misrepresentation
Connecticut-based hedge fund Amaranth will pay a $7.5 million civil fine to settle charges of attempted manipulation of the price of natural gas futures and subsequent misrepresentation to the New York Mercantile Exchange (Nymex).
The fine follows a complaint filed by the US Commodity Futures Trading Commission (CFTC) in July 2007, reporting that on February 24 and April 26, 2006 Amaranth acquired more than 3,000 Nymex natural gas futures contracts in advance of the closing range, most of which were subsequently sold during the closing range.
The US District Court for the Southern District of New York ordered the fine yesterday and also enjoined Amaranth Advisors LLC and ULC from violating the anti-manipulation and anti-misrepresentation provisions of the Commodity Exchange Act. The claims in the CFTC complaint against Brian Hunter, the head natural gas trader for the Amaranth entities, are not affected by the settlement.
See also: CFTC files civil action against Amaranth
CFTC: record levels of crime in energy markets
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