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

Malik: The Science of Deal Sourcing 201

Aug 27 2015 | 5:35pm ET

Deal sourcing is understandably a hot topic among private equity firms because it...

Lifestyle

Rolling Art Advisors Marketing Collectible Car Fund As Uncorrelated Alternative

Aug 27 2015 | 6:47pm ET

A new fund is trying to provide investors with greater access to an emerging asset...

Guest Contributor

FATCA for Hedge Funds: Eight Common Pitfalls

Sep 1 2015 | 10:56am ET

FATCA is now a way of life for those in the financial industry and most professionals...

 

Editor's Note