After the U.S. Federal Energy Regulatory Commission (FERC) hit Deutsche Bank with a $1.5 million penalty and disgorgement of profits of $123,198, the bank has struck back, with its energy trading unit denying charges that it rigged the energy market in 2010 and saying that the penalties should be dropped.
Bloomberg reported Wednesday that in a Sept. 5 order, FERC’s enforcement staff said the bank’s energy unit, Deutsche Bank Energy Trading LLC, provided false information regarding its trading activities in the California energy market in early 2010.
However, the unit said in a filing appearing on FERC’s website Wednesday, “The legal position enforcement has taken here is radical. If the commission does not abandon these deeply flawed allegations now, they will be overturned by a federal district court.”
The bank’s filing said that its energy trading unit “did not intentionally trade against its interests,” contrary to FERC’s enforcement unit findings after its investigation was complete. The filing also said, “Traders saw arbitrage opportunities—the chance to ‘buy low and sell high’” because the prices at one power-delivery point were “significantly” lower than they were in another delivery point.