E.U. Investigates Shell and Others on Oil Market Pricing

Authorities have sharpened scrutiny of financial benchmarks around the world since slapping large fines on some of the world's biggest banks for rigging interest rate benchmarks.

On Tuesday, the European Commission said it was investigating major oil companies over suspected anti-competitive agreements related to submission of prices to leading oil pricing agency Platts, a unit of McGraw Hill Group.

"Officials carried out unannounced inspections at the premises of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors," the Commission said. The inspections took place in two EU member states and one non-EU country, it said.

"The Commission has concerns that the companies may have colluded in reporting distorted prices to a price reporting agency to manipulate the published prices for a number of oil and biofuel products," it said.

The Commission also said companies may have prevented others from participating in the price assessment process, with a view to distorting published prices.

Statoil said the suspected violations were related to the Platts price assessment process and may have been ongoing since 2002.

The probe will shine a light on the methodology designed by Platts for daily assessments on the physical oil markets, used to close deals worth billions of dollars.

The so-called Platts window, or market-on-close (MOC) system, is a daily half-hour period in which it determines cash prices through a series of bids, offers and trades.

Critics say the system is only a snapshot of the market, because it excludes trade outside the window - one reason that it can be vulnerable to manipulation.

"I remember looking at these sorts of issues 10 years ago, and nothing has changed, it's sort of an accident waiting to happen," said Craig Pirrong, Professor of Finance at the University of Houston, noting that after the Libor scandal, price assessment agencies were under "incredible scrutiny."

"Regulators and law enforcement officials are quite upset with this sort of alleged conduct and they have proven that they are willing to go after companies that misreport for very large sums of money," Pirrong said.

"Potentially the exposure is quite large."

PRICE DISTORTIONS

The Commission said that even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales, potentially harming final consumers.

It added the fact inspections had been carried out did not mean the companies were guilty of anti-competitive behavior.

The Commission did not make clear whether it was investigating a specific incident. These investigations typically take years to draw final conclusions.

Platts, Royal Dutch Shell, BP and Statoil said they were cooperating with the probe.

French major Total said there had been no inspections at its offices. The Commission did not list the companies being investigated, and it was not clear whether other companies were included.

Statoil said authorities had inspected its office in Stavanger on the request of the European Commission on suspicions of anti-competitive behavior.

The Norwegian state, the controlling shareholder of Statoil, said the probe was a matter for the company's management to handle and declined further comment.

Platts said the European Commission had "undertaken a review at its premises in London this morning in relation to the Platts price assessment process".

The International Organization of Securities Commissions (IOSCO) is running a wider review of benchmarks, and the U.S. Commodity Futures Trading Commission is looking into the setting of gold and silver prices in London.

IOSCO said it was not involved in the oil enquiry. The CFTC declined to comment, and the Federal Trade Commission had no immediate comment.

Thomson Reuters, parent of Reuters news, competes with Platts in providing news and information to the oil market.

(With additional reporting by Barbara Lewis in Brussels, Matthew Robinson in New York, Diane Bartz in Washington; Editing by Jane Baird and Chris Reese)

Gaining Experience and Helping Others at the Same Time

Most young attorneys understand and appreciate the value of doing pro bono legal work. For many, in a world where billable hours reign supreme, the issue is almost always one of diverting time away from fee-based matters and devoting the necessary amount of time to properly represent those in need.

However, when making this calculation, many young attorneys fail to recognize the positive effects doing pro bono work can have on their own careers. If there is any question in your mind as to whether you should commit to a pro bono representation, the immediate tangible benefits you will almost certainly see to your own career growth and development should tip the scales firmly in favor of doing so.

When I started practicing law as a litigation associate in one of Philadelphia's largest firms, I was eager to dive right in and get started. With scenes from My Cousin Vinny and other law-themed movies fresh in my mind, I could picture myself taking the Philadelphia courts by storm right out of the gate.

Of course, I know now, and deep down I probably knew then, that getting into court as a first-year associate is not always easy, especially in some of the larger firms. While firms are typically mindful of exposing young associates to actual courtroom experiences from an early stage in their careers, such experience usually comes in the form of observing a more senior attorney and/or mentor argue. The opportunities to actually stand before a judge or arbitrator and argue can be few and far between.

Luckily, I had an ace up my sleeve in the form of pro bono work. While at law school, I had been involved in a clinic that advised indigent clients on custody and support issues, and knew that I wanted to continue to help such clients as I built my practice. I quickly got in touch with Philadelphia VIP (with whom I highly recommend volunteering), found a case that looked interesting and off I went. Within a matter of weeks, I was arguing before a judge in family court.

Other pro bono opportunities came my way, and I always jumped at the opportunity to not just get involved, but to get valuable experience along the way. In addition to trying to always have at least one active pro bono child custody case, I have negotiated a settlement for an injured woman who entered into a structured settlement, represented a local neighborhood association in a dispute with various members of its community and represented prisoners in civil rights actions as part of the Prisoner Civil Rights Panel of the U.S. District Court for the Eastern District of Pennsylvania.

Each of these matters provided me with valuable, yet distinct, opportunities to refine my legal skills from an early point in my career. Whether it was getting into court from an early stage, taking and defending depositions or dealing directly with and advising clients, I feel fortunate to have had such great pro bono opportunities from the outset of my career. Young lawyers should make it a point to seek out similar pro bono opportunities early and often.

There is no mandatory pro bono requirement for attorneys imposed by the Pennsylvania Rules of Professional Conduct. However, Rule 6.1 is clear that a "lawyer should render public interest legal service." Although this appears to fall short of required pro bono service for Pennsylvania lawyers, the rule continues to discuss ways by which a "lawyer may discharge this responsibility." Thus, although the language of the rule is permissive, it is clear that pro bono service is not just something nice that lawyers can do, but indeed is a responsibility for all those who choose to practice law and be barred in Pennsylvania.

For young lawyers, the choice should be a no-brainer. Why not take advantage of your obligation to help not just those in need, but to help yourself by furthering your own career? It is truly a situation where everybody wins.

Of course, my purpose is not to suggest that attorneys should place their own career interests ahead of those of their pro bono clients or prospective clients. Indeed, the comments to Rule 6.1 state that "personal involvement in the problems of the disadvantaged can be one of the most rewarding experiences in the life of a lawyer." This is certainly the case. The overriding principle behind pro bono is the opportunity and, to be sure, the moral, ethical and professional obligation to provide legal assistance to those who truly need it but are unable to afford it.

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Gaining Experience and Helping Others at the Same Time

Most young attorneys understand and appreciate the value of doing pro bono legal work. For many, in a world where billable hours reign supreme, the issue is almost always one of diverting time away from fee-based matters and devoting the necessary amount of time to properly represent those in need.

However, when making this calculation, many young attorneys fail to recognize the positive effects doing pro bono work can have on their own careers. If there is any question in your mind as to whether you should commit to a pro bono representation, the immediate tangible benefits you will almost certainly see to your own career growth and development should tip the scales firmly in favor of doing so.

When I started practicing law as a litigation associate in one of Philadelphia's largest firms, I was eager to dive right in and get started. With scenes from My Cousin Vinny and other law-themed movies fresh in my mind, I could picture myself taking the Philadelphia courts by storm right out of the gate.

Of course, I know now, and deep down I probably knew then, that getting into court as a first-year associate is not always easy, especially in some of the larger firms. While firms are typically mindful of exposing young associates to actual courtroom experiences from an early stage in their careers, such experience usually comes in the form of observing a more senior attorney and/or mentor argue. The opportunities to actually stand before a judge or arbitrator and argue can be few and far between.

Luckily, I had an ace up my sleeve in the form of pro bono work. While at law school, I had been involved in a clinic that advised indigent clients on custody and support issues, and knew that I wanted to continue to help such clients as I built my practice. I quickly got in touch with Philadelphia VIP (with whom I highly recommend volunteering), found a case that looked interesting and off I went. Within a matter of weeks, I was arguing before a judge in family court.

Other pro bono opportunities came my way, and I always jumped at the opportunity to not just get involved, but to get valuable experience along the way. In addition to trying to always have at least one active pro bono child custody case, I have negotiated a settlement for an injured woman who entered into a structured settlement, represented a local neighborhood association in a dispute with various members of its community and represented prisoners in civil rights actions as part of the Prisoner Civil Rights Panel of the U.S. District Court for the Eastern District of Pennsylvania.

Each of these matters provided me with valuable, yet distinct, opportunities to refine my legal skills from an early point in my career. Whether it was getting into court from an early stage, taking and defending depositions or dealing directly with and advising clients, I feel fortunate to have had such great pro bono opportunities from the outset of my career. Young lawyers should make it a point to seek out similar pro bono opportunities early and often.

There is no mandatory pro bono requirement for attorneys imposed by the Pennsylvania Rules of Professional Conduct. However, Rule 6.1 is clear that a "lawyer should render public interest legal service." Although this appears to fall short of required pro bono service for Pennsylvania lawyers, the rule continues to discuss ways by which a "lawyer may discharge this responsibility." Thus, although the language of the rule is permissive, it is clear that pro bono service is not just something nice that lawyers can do, but indeed is a responsibility for all those who choose to practice law and be barred in Pennsylvania.

For young lawyers, the choice should be a no-brainer. Why not take advantage of your obligation to help not just those in need, but to help yourself by furthering your own career? It is truly a situation where everybody wins.

Of course, my purpose is not to suggest that attorneys should place their own career interests ahead of those of their pro bono clients or prospective clients. Indeed, the comments to Rule 6.1 state that "personal involvement in the problems of the disadvantaged can be one of the most rewarding experiences in the life of a lawyer." This is certainly the case. The overriding principle behind pro bono is the opportunity and, to be sure, the moral, ethical and professional obligation to provide legal assistance to those who truly need it but are unable to afford it.

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DealBook: Wells Fargo Banker and 9 Others Charged With Insider Trading

The Securities and Exchange Commission accused a Wells Fargo investment banker of insider trading on Wednesday, saying that he and others took advantage of nonpublic information he obtained about merger deals involving clients.

The agency said that the banker, John W. Femenia, 30, would pass along information to a friend, Shawn C. Hegedus, who worked as a stockbroker. The two tipped other friends, who in turn passed along the information to other friends or family members, the civil complaint said. All told, the group garnered more than $11 million in illicit profits trading, the agency said.

“Here you have an investment banker who clearly knew better that inside information can’t form the basis of trading decisions,” William P. Hicks, associate director for enforcement in the S.E.C.’s Atlanta office, said in a statement. “Instead he basically started a phone tree of nonpublic information to enrich friends and others.”

Mr. Femenia is accused of tipping others about four merger deals included the acquisition of the Smurfit-Stone Container Corporation by the Rock-Tenn Company and the sale of the Shaw Group to Chicago Bridge & Iron.

The agency said that Mr. Femenia, who works for Wells Fargo Securities in New York, obtained most of the information about the deals when he worked for the firm in Charlotte, N.C.

“Wells Fargo has detailed policies and training programs on the handling of confidential information, and we have a zero-tolerance policy for the misuse of such information,” a Wells Fargo spokeswoman said in a statement. ‘We learned about the underlying allegations yesterday and are assisting and fully cooperating with the S.E.C. and other agencies in these proceedings.”

According to the S.E.C.’s civil complaint, the recipients of the tips traded in the stock and options of the companies being acquired in the deals, and at least one trader provided a portion of his profits to Mr. Femenia in exchange for the information.