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Tuesday, May 28, 2024 | Back issues
Courthouse News Service Courthouse News Service

Gas Traders Get Long Terms for Fraud

(CN) - Three El Paso Merchant Energy employees, two of whom were natural gas traders, were sentenced to long terms in federal prison for conspiracy, false reporting and wire fraud.

U.S. District Judge Melinda Harmon in Houston sentenced James Brooks, 50, a former managing director of North American natural gas sales for El Paso, to 168 months in prison, 3 years supervised release and a $5,000 fine.

Natural gas traders Wesley Walton, 47, and James Phillips, 50, were each sentenced to 135 months in prison3 years of supervised release, and $7,500 fines.

A jury convicted the men on Feb. 7, 2008, after a 2-month trial.

Between April 2000 and May 2002 the men submitted or aided in submission of reports containing fictitious trades to industry publications, to influence natural gas prices in El Paso's favor.

Brooks was convicted of one count of conspiracy, 22 counts of false reporting and 22 counts of wire fraud.

Walton was convicted of one count of conspiracy, 11 counts of false reporting and 11 counts of wire fraud.

Phillips was convicted of one count of conspiracy, 10 counts of false reporting and 10 counts of wire fraud.

The U.S. Attorney's Office said the convictions followed the 2006 trial in which former Dynegy natural gas trader Michelle Valencia was convicted of seven counts of wire fraud and El Paso natural gas trader Greg Singleton was convicted of one count of wire fraud. In that case, former El Paso traders Todd Geiger, Chris Bakkenist, Bill Ham, Don Guilbault, Dallas Dean, Don Burwell, and former Reliant natural gas trader Jerry Futch also pleaded guilty to federal charges.

Brooks, Walton, and Phillips remain free on bond pending issuance of an order to surrender to a Bureau of Prisons facility; the order is expected soon.

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