Barclays: US $470m energy fine 'unjustified'

Barclays branch in central London Barclays has been hit by a series of scandals

Related Stories

Barclays has said US regulators' proposed fines of $470m (£291m) for the bank's alleged manipulation of energy markets are "unjustified" and the allegations will not stand up in court.

The Federal Energy Regulatory Commission (Ferc) has accused four Barclays traders of manipulating power prices in the US from 2006-2008.

Barclays denies the charges.

In a filing on Friday, the bank said Ferc's allegations were "based on an economically irrational theory".

The Office of Enforcement (OE), a branch of Ferc, allege the team of four traders exchanged messages explaining how they would use certain trades in one market to profit in another.

The traders are alleged to have manipulated power prices to make money with their financial swap positions, causing losses for rival power traders of $139m and winning the bank $34.9m.

'Hollow claims'

But Barclays said: "The underlying allegations are inconsistent with the facts and incorrectly rely on erroneous inferences drawn from mere fragments of documents.

"The investigative record, when read carefully and objectively, is plainly insufficient to establish each element of a violation of the Anti-Manipulation Rule by a preponderance of the evidence - the evidentiary standard the Commission will be required to meet in federal district court."

The bank went on: "OE's claims ring even more hollow because they are not accompanied by any explanation as to how OE arrived at its overstated and unjustified claims of disgorgement and civil penalties for Barclays.

"For these reasons, the Commission should terminate this proceeding without any further action."

Barclays' reputation has been hit by a series of scandals in recent months.

In June, it was fined £290m by UK and US regulators for attempting to manipulate Libor, an interbank lending rate which affects mortgages and loans.

In August, the Serious Fraud Office started an investigation into payments between Barclays' bank and Qatar Holding in 2008 when the bank was raising money in the Middle East during the banking crisis.

In the UK Barclays has also been part of the industry wide mis-selling of payment protection insurance (PPI) to individuals and the mis-selling of specialist insurance - called interest rate swaps - to small businesses.

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Features & Analysis

Elsewhere on the BBC

  • ITChild's play

    It's never been easier for small businesses to get their message out to the world

Programmes

  • Joe Ierardi playing a pianoClick Watch

    Meet the man trying to create the perfect digital piano - but is it as good as the real thing?

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.