Houston-based Reliant Resources Inc. (RRI) on Monday said it was “not aware” that any of its employees manipulated or attempted to manipulate natural gas price indexes by submitting fake information to energy publications, while Duke Energy Trading and Marketing LLC reported it “admonished” several traders who “knew or should have known” about the reporting of false data to publishers.

Following a “reasonably diligent internal review,” RRI said it could not find that any employee of Reliant Energy Services Inc. (RES), RRI’s wholesale gas marketing arm, intentionally engaged in the reporting of false prices and volume data to energy newsletters.

“Any inaccuracies in natural gas prices that may have been reported to entities that publish price indices by RES employees were the result of unintentional errors, not of attempts to manipulate the indices,” RRI told the Federal Energy Regulatory Commission [PA03-9].

Duke Energy said it issued “letters of admonishment” against two basis traders who either “knew or should have known” about the reporting of bogus information to published gas price indexes, and it demoted six employees to non-managerial positions and admonished them as well. All of the traders or employees were involved in gas trading in the East, according to the company [PA03-6].

Both RRI and Duke Energy were responding to an April order in which FERC directed 11 major energy companies, many of who have publicly admitted providing false data to trade publications that publish indexes, to prove that they have changed their ways. The companies were ordered to show that they have taken disciplinary actions against rogue traders, installed controls to prevent any attempt at price index manipulation in the future, or have exited the wholesale gas marketing and trading business entirely (see Daily GPI, May 1).

Even though it was unable to uncover any wrongdoing, RRI said the remaining RES trading staff, which has been “considerably reduced” since 2000, “received extensive training in business ethics, RRI’s vision and values, and best principles and practices for energy trading.” Moreover, it noted the company ceased all price reporting last May, and does not plan to resume the activity until “reliable, industry-wide reporting procedures” can be agreed upon.

When that occurs, “RES will ensure that such reporting is conducted by personnel of the company that do not have a financial interest in the published index,” the company said.

Duke Energy said it continues to submit gas prices to publications, but it noted the company’s Business Risk Management Office — rather than individual traders — is providing the information to the energy newsletters. “A Gas Management System (GMS) or a Power Trading System (PTS) report is generated at the end of each business day to verify that transactions have been input in a timely manner. If an error or omission is discovered in submitted data for a transaction within 48 hours of when the transaction is booked, the corrected data is re-submitted to the applicable publications by the end of the business day” following the close of the 48-hour period, Duke Energy noted.

The Charlotte, NC-based energy company said it has responded to requests from the Commodity Futures Trading Commission and a San Francisco grand jury about its past reporting practices. It noted it also has had a “series of meetings” with the CFTC, including a joint meeting with FERC, to answer questions about the reporting of prices.

RRI noted it was “cooperating fully” with governmental agencies investigating its past reporting practices, but it did not provide any details.

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