Three sentenced in fictitious-trade case

A former managing director of North American natural gas sales at El Paso Merchant Energy (EPME) and two of the El Paso Corp. division’s gas traders have been sentenced for conspiracy, false reporting, and wire fraud, according to the Department of Justice.

Dec 22nd, 2009

Nick Snow
Washington Editor

WASHINGTON, DC, Dec. 22 – A former managing director of North American natural gas sales at El Paso Merchant Energy (EPME) and two of the El Paso Corp. division’s gas traders have been sentenced for conspiracy, false reporting, and wire fraud, according to the Department of Justice.

James Brooks, the former EPME managing director, received a 168-month prison term, followed by 3 years of supervised release, and was fined $5,000. The traders, Wesley C. Walton and James Patrick Phillips, were sentenced to 135 months each in prison, followed by 3 years of supervised release, and ordered to pay fines of $7,500 each.

The men were convicted of the federal charges on Feb. 7, 2008, following a 2-month jury trial. The jury found that between April 2000 and May 2002, the defendants submitted to or aided in submission of reports containing fictitious trades to industry publications in an attempt to influence gas prices in El Paso’s favor.

Brooks was convicted of 1 count of conspiracy, 22 counts of false reporting, and 22 counts of wire fraud. Walton was convicted of 1 count of conspiracy, 11 counts of false reporting, and 11 counts of wire fraud. Phillips was convicted of 1 count of conspiracy, 10 counts of false reporting, and 10 counts of wire fraud.

Contact Nick Snow at nicks@pennwell.com.

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