Amidst a flurry of sealed pleadings and orders denying his attempt to withdraw his guilty plea, former Reliant Energy natural gas trader Jerry Futch was sentenced to almost five years in prison yesterday by U.S. District Judge David Hittner based on Futch’s guilty plea on charges that he provided false information on natural gas trades to publications that produce indexes used to value natural gas contracts.
Here is an earlier post on Futch’s case, which raises troubling questions regarding his employer and its counsel’s derogation of Futch’s self-incrimination and attorney-client privileges.
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Longtime Houston attorney Tom Kirkendall's observations on developments in law, business, medicine, culture, sports, and other matters of general interest to the Houston business, professional, and academic communities.
Tom,
None of these “trader” cases have gone before a jury and many of the traders pled guilty, even waving their right to a grand jury. Until Todd Geiger, no energy trader had ever been charged under this law which I believe was meant to apply to brokers on a futures exchange and not over-the-counter traders. Mr. Futch ran out of money, pled guilty and spent hours educating the government about reporting procedures at his company and in the industry. For this, the prosecutor tells the judge at sentencing that Jerry provided them with no meaningful help and the judge hands him the max sentence. The government isn’t interested in fairness, the government’s cases against these traders have many holes, and they have no idea how to calculate damages (if, in fact, there were any). How must the rest of the traders that pled guilty, expecting their cooperation to reap a lesser sentence, feel today? The rough treatment of Mr. Futch could backfire for the government. The other traders with charges who might have been thinking about “stopping out” and throwing themselves before the mercy of the court see now that no mercy will be given. Will the traders that pled guilty be worse cooperators now knowing that the government “bear hug” is no hug at all?