JPMorgan Chase, a firm whose reputation in Washington has eroded in a matter of months, is now moving to avert a showdown over accusations that it manipulated energy prices.
The New York Times reports that the bank, which has previously clashed with its regulators, is seeking to settle with the federal agency that oversees the energy markets, according to people briefed on the matter.
The regulator, the Federal Energy Regulatory Commission, found that JPMorgan devised “manipulative schemes” that transformed 'money-losing power plants into powerful profit centers', a commission document said.
The potential deal, the people said, is expected to cost the bank about $500m, a record for the commission, which has adopted a harder line with Wall Street over the last year. For JPMorgan, which reported a record $6.5bn quarterly profit last week, the fine will hardly dent the bottom line.
The accusations against JPMorgan surfaced this spring in the confidential commission document, reviewed by The New York Times, that outlined a pattern of illegal trading in the California and Michigan electric markets.
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