Amaranth Trader, CFTC Win Jurisdictional Fight With Energy Regulator

Mar 18 2013 | 2:04pm ET

The man whose trades doomed Amaranth Advisors has put a serious crimp into the Federal Energy Regulatory Commission's authority.

A federal appeals court in Washington last week threw out FERC's $30 million fine against Brian Hunter for alleged market manipulation. The court agreed with the Commodity Futures Trading Commission that it alone has authority over futures contracts.

"Manipulation of natural gas futures contracts falls within the CFTC's exclusive jurisdiction," the court ruled.

FERC levied the fine against Hunter two years ago—the largest in the history of the regulator—accusing him of seeking to depress prices. The CFTC put its own case against Hunter on hold last year after Hunter sued FERC.

"FERC unjustly vilified Mr. Hunter for years, but it was in fact the FERC which had acted outside of the law," Hunter's lawyer, Michael Kim, said.

Hunter's natural-gas trades cost Amaranth $6.6 billion in September 2006, leading to the hedge fund's implosion.


In Depth

Change In 'Accredited Investor' Definition Could Hurt Crowdfunding Space

Jul 25 2014 | 8:14am ET

The Securities and Exchange Commission is considering changes to its 30-year-old...

Lifestyle

David Yarrow On Growing His Hedge Fund And Shooting The Animals And People Of Africa - As A Photographer

Jul 23 2014 | 6:44am ET

While he’s always been a photographer, recent expeditions to Iceland, Ethiopia...

Guest Contributor

The Truth About Track Record Portability

Jul 24 2014 | 5:55am ET

The number of private funds converting to mutual funds has increased significantly...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note