Market Manipulation Without Market Power

Law360, New York (June 23, 2011, 4:47 PM EDT) -- The Commodity Futures Trading Commission recently filed an action against Parnon Energy Inc. et. al., alleging the manipulation of NYMEX oil futures contracts to the benefit of derivatives positions.[1] Because the behavior in question took place in 2008 before the passage of Dodd-Frank, the CFTC must bring this case using the “artificial price” standard of the Commodities Exchange Act.[2]

This requires a demonstration that the alleged manipulator moved a price away from competitive levels, an element that has proven difficult to establish absent a showing of...
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