This should mean California gets released from all those usurous contracts
Reliant and 4 Officers Indicted in California Energy Shortage
WASHINGTON, April 8 (Reuters) - A federal grand jury returned an indictment on Thursday charging a unit of the energy company Reliant Resources and four of its officers with driving up electricity prices in California by creating a false shortage.
The indictment charged Reliant Energy Services and Jackie Thomas, a former vice president of Reliant's power trading division; Reggie Howard, a former director of the trading division; Lisa Flowers, a term trader for the trading division, and Kevin Frankeny, Reliant's manager for Western operations.
The company and executives were charged with conspiracy to commit wire fraud and commodities manipulation, wire fraud and manipulation and attempted manipulation of the price of a commodity in interstate commerce.
According to the indictment, Reliant Energy Services and its officers and employees intentionally drove up the price of electricity in California during June of 2000 by shutting off its power generation to create the false appearance of a shortage.
The indictment said the plan worked and Reliant Energy Services reaped millions in illegal profits.
The Justice Department said the charges were the first ever brought against a corporate entity for engaging in fraudulent and manipulative trading practices during the California energy crisis of 2000-2001.
The indictment says that Reliant was faced with a potential multimillion dollar loss in June 2000 when prices in the electricity markets fell sharply. In order to reverse its losing position, the defendants devised a scheme to force the price of electricity up by shutting off most of the company's power plants, thus creating the appearance of an electricity shortage, the indictment contends.
Reliant then disseminated false and misleading information to the market that wrongly attributed the shutdowns to environmental limitations and maintenance problems, according to the indictment.
