Watch out, speculators: The Commodity Futures Trading Commission is getting tough on crime. But since, as the CFTC has said, speculation hasn't pushed up prices, the crackdown will benefit its image more than the economy.
Under increasing pressure from Congress in recent months to crack down on speculative activity in the oil futures markets, today the CFTC filed civil charges against Optiver, a Dutch hedge fund, plus two subsidiaries and three employees, alleging manipulation of crude oil, heating oil and gasoline futures prices on the NYMEX. According to the charges, the defendants attempted to manipulate short-term prices on 19 different occasions in March 2007, were successful at least five times, and netted an illicit profit of $1 million.
"Today's action lets the marketplace know that the division of enforcement has a zero-tolerance policy for illegal gamesmanship when it comes to our nation's vital futures markets," said Stephen Jay Obie, the CFTC's acting head of enforcement, at the press conference.
Asked if he was willing to say that the charges are not politically timed, Obie heartily obliged. "I categorically deny it," he responded.
Calls by CNNMoney.com to Optiver seeking comment were not answered, and an e-mail was not immediately returned.
