20 December 2004 – LAWFUEL – First with law news – The United States Attorney’s Office for the Northern District of California announced that Thomas J. Pool pled guilty today to the manipulation of natural gas prices in interstate commerce. Mr. Pool, 31, of Tulsa Oklahoma, is a former natural gas trader at Williams Energy Marketing & Trading, a subsidiary of The Williams Companies based in Tulsa, Oklahoma.
In pleading guilty, Mr. Pool admitted that between approximately June 1, 1998 to June 30, 2002 he conspired with others at Williams Energy Marketing & Trading to report fictitious trades to two industry newsletters, Inside FERC’s Gas Market Report and NGI’s Bidweek Survey. Pool admitted to adding fictitious trades to a spreadsheet to achieve the desired price of natural gas that he would report to the publications for the purpose of manipulating the index prices published in these newsletters
“This plea – the admission by a natural gas trader of actual index price manipulation – is the first of its kind,” said U.S. Attorney Kevin V. Ryan. “This plea will be instrumental in helping the government assess gain and loss figures for gas price manipulation, as well as to understand better the motivations behind price manipulation attempts among physical natural gas traders.”
Mr. Pool admitted that he knew how his position would benefit from high or low published index prices, and that other traders often indicated to him how their positions would benefit from high or low published index prices. Pool also admitted that his supervisor taught him how to arrange the false trades to look like a random sampling that would appear credible to the publications. He admitted that the false trades he reported in January 2001 affected the published index prices for February 1, 2001.
Mr. Pool waived indictment and was charged by information on Friday, December 10, 2004. He was charged with one count of manipulation of the price of a commodity in interstate commerce in violation of the Commodities Exchange Act.
Under the plea agreement, Mr. Pool agreed to cooperate with the United States’ ongoing investigations into manipulation of natural gas index prices.
The maximum statutory penalty for each count in violation of 7 U.S.C. Section 13(a)(2) is five years of prison and a fine of $500,000. The actual sentence, however, will be dictated by the Federal Sentencing Guidelines, which take into account a number of factors, and will be imposed in the discretion of the Court.
This guilty plea is the result of a two year investigation by agents of the Federal Bureau of Investigation with much assistance from staff at the Commodity Futures Trading Commission. This case was brought jointly by the Northern District of California and the Fraud Section of the Criminal Division of the Department of Justice. Prosecutors include Robertson Park, Assistant Chief of the Fraud Section, Eugenia Cowles, Trial Attorney with the Fraud Section, and Keslie Stewart, Special Assistant United States Attorney for the Northern District of California. Ms. Stewart is on loan to the U.S. Attorney’s Office from the Antitrust Division of the Department of Justice to pursue investigations related to the California energy crisis of 2000-2001. Legal technicians Kelly Michell and Katie Cannuli assisted with the investigation from the Northern District of California.
A copy of this press release and related court filings may be found on the U.S. Attorney’s Office’s website at www.usdoj.gov/usao/can . Related court documents and information may be found on the District Court website at www.cand.uscourts.gov or on .
All press inquiries to the U.S. Attorney’s Office should be directed to Luke Macaulay at (415) 436-6757 or by email at Luke.Macaulay3@usdoj.gov .
