FORMER GAS TRADER SENTENCED

 

 

   HOUSTON, TX – Todd Geiger, 42, a former gas trader and vice president of El Paso Corporation (El Paso), was sentenced to a prison term for falsely reporting gas trades, announced United States Attorney Don DeGabrielle.

At a hearing today before United States District Judge Nancy F. Atlas, Geiger was sentenced to 24 months in federal prison, without parole, followed by two years of supervised release. Geiger has been permitted to remain free on bond pending an order to surrender to a U.S. Bureau of Prisons facility to be designated in the near future.

Geiger was convicted on December 11, 2003, after admitting that in November 2001 he ordered a report containing 48 false gas trades to be sent via email to a trade publication, Inside FERC, for use in calculating a natural gas "index" price relied upon by many in the industry for the buying and selling of large volumes of natural gas.

El Paso natural gas traders regularly participated and transmitted surveys via email to Inside FERC and NGI, another trade publication, which included a list of natural gas trades conducted during a given month. Geiger and other natural gas traders at El Paso made a decision to report inaccurate data to Inside FERC and NGI for the purpose of favoring El Paso 's trading position.

Although Inside FERC ultimately did not use the 48 El Paso trades transmitted on Geiger's order to calculate the December 2002 index price for natural gas, one industry newsletter did rely on the inaccurate information. The use of the inaccurate information resulted in a index price $0.14/MMBu lower that the index price published by Inside FERC.

The Geiger indictment, filed in December 2002, was the first indictment brought in the Southern District of Texas as a result of the work of The President's Corporate Fraud Task Force, of which this district is a principal member. The investigation was conducted by Federal Bureau of Investigation, the United States Postal Inspection Service and the Commodity Futures and Trading Commission. The case was prosecuted by Assistant United States Attorneys John Lewis and Belinda Beek.