The Commodity Futures Trading Commission (CFTC) and the Federal Energy Regulatory Commission’s (FERC) 2015 enforcement reports reveal one agency – the CFTC – imposing record fines, with the other – FERC – continuing its current path while defending its previous actions in U.S. District Court litigation throughout the country.

The CFTC had another record year of enforcement activity. The CFTC filed almost 70 enforcement actions. It imposed $3.144 billion in monetary penalties, bringing total monetary sanctions over the past two years to more than $6.4 billion.

The CFTC continued to focus on disruptive trading practices: specifically “spoofing” – entering an order with the intent to cancel it before it is consummated in a complete transaction. The CFTC emphasized accurate reporting, bringing at least two actions when market participants continued to file inaccurate reports after being directed to fix the problem. Wash trades (offsetting transactions with no economic risk) were also the subject of two enforcement actions. The CFTC brought an action against an attorney for aiding and abetting multiple clients in illegal and fraudulent precious metals schemes. Finally in 2015, the CFTC made its second award to a whistleblower who provided information about violations of the Commodity Exchange Act.

In contrast, the FERC was “steady as she goes,”  imposing $26 million in penalties.

A significant amount of FERC’s enforcement activity was spent defending its previous enforcement decisions in various U.S. District Courts across the country. There are six District Court actions pending, two relate to general market manipulation (allegedly manipulating demand response baselines and allegedly using less costly fuels, but getting paid for more expensive fuels) and four relate to allegedly taking a market position for the sole purpose of moving another market position.

The FERC has beat back preliminary challenges in one case. In FERC v. Barclays Bank, PLC, No. 2:13-cv-2093 (E.D. Cal.), the District Court ruled in relevant part that: (i) a transaction occurring on an open market is not a defense to manipulation, i.e., an alleged scheme accomplished solely through the use of facially legitimate open market transactions can be manipulative and (ii) the FERC’s anti-manipulation provision applies to individuals as well as corporations.

Further the FERC Enforcement Report was interesting for what the FERC did not do – the FERC highlighted 11 actions that it closed without further action. These non-actions highlight the importance in any company specific FERC compliance program of (1) maintaining contemporaneous data justifying transactions, (2) the ability to detect inappropriate activity and to promptly self-report that activity when detected and (3) aggressively changing practices to prevent future inappropriate activity.