Commission Finds Oil Price Manipulation

clipped from money.cnn.com The Commodity Futures Trading Commission accused Optiver Holding, two of its subsidiaries and three employees with manipulation and attempted manipulation of crude oil, heating oil and gasoline futures on the New York Mercantile Exchange. "Optiver traders amassed large trading positions, then conducted trades in such a way to bully and hammer the markets," CFTC Acting Chairman Walt Lukken said at a press conference. "These charges go to the heart of the CFTC's core mission of detecting and rooting out illegal manipulation of the markets." The complaint filed Thursday names Bastiaan van Kempen, chief executive; Christopher Dowson, a head trader; and Randal Meijer, head of trading at an Optiver subsidiary. The CFTC said the firm attempted to "bang the close" by amassing large positions just before markets closed - forcing prices up - then selling them quickly to drive prices down and pocketing the difference.

The article goes on to say "...overall, most experts say the incidents are so scattered, and the energy market so large, that it's unlikely a single trader or group of traders can have substantial sway over prices."

Of course, if this turns out to be an even fairly common crime, then the cumulative effect could be much larger. After the big corporate crime wave of '04, I think it's foolish to give them the benefit of the doubt.