A federal judge in Houston yesterday approved Enron Corp.'s $35 million settlement with the Commodity Futures Trading Commission over allegations the company manipulated natural gas prices in 2001.
U.S. District Judge Melinda Harmon entered a consent order that resolved all charges brought by the commodities regulator against the Houston energy company, the CFTC said in a statement. U.S. Bankruptcy Judge Arthur Gonzalez in New York approved the settlement in May.
Approval of the settlement means the U.S. government will be added to the list of creditors owed as much as $74 billion by Enron, which collapsed in December 2001. Last week, the company won court approval for a plan to emerge from bankruptcy by paying creditors an average of 20 cents on the dollar.
"It's all a matter of whether there are sufficient funds available at the time of distribution of the estate," Vincent McGonagle, senior deputy director of enforcement at the CFTC, said in an interview. "That will determine how much the U.S. Treasury is paid as a result of this settlement."
In a separate statement, the commission said former Enron gas trader Hunter Shively agreed to pay $300,000 to settle charges relating to his alleged involvement in manipulating prices. The settlement requires Shively to cooperate with the commission's investigations.
The commodities regulator in March 2003 alleged that Enron and Shively bought and sold large amounts of gas in a short time period in prearranged transactions, thereby affecting wholesale prices. Movement in wholesale prices affected futures prices on the New York Mercantile Exchange, according to the CFTC.