Financial Crime World

Danish Electricity Producer Under Investigation for Alleged Insider Trading

The Danish Supply Authority, the country’s utility regulator, has reported an unnamed Danish electricity producer to the police for suspected insider trading. This follows the company’s failure to disclose a reduction in production capacity in a timely manner, enabling it to buy electricity on the European intraday market at lower prices than competitors.

Suspected Breach of EU Regulations

The Danish Supply Authority suspects the electricity producer breached EU regulations related to market integrity and transparency. These regulations require market participants to publish relevant internal information before making transactions that could impact market pricing.

According to a statement released on Wednesday, the producer is believed to have violated these rules by not disclosing the reduction in production capacity before taking advantage of the lower electricity prices.

The Importance of Disclosing Internal Information

The Danish Supply Authority’s director, Carsten Smidt, emphasized the importance of market participants disclosing any information that may significantly influence market prices before taking any actions.

“When market participants obtain information that may significantly influence market prices, they must disclose it before taking any actions.”

  • Carsten Smidt, Danish Supply Authority

Investigation and Current Cases

The electricity producer under investigation has been informed of the alleged violation of the rule to publish internal information and the ban on insider trading under EU rules. The Danish Supply Authority is currently investigating several cases of suspected insider trading due to increased market volatility.

Europe’s power prices have reached unprecedented highs due to various factors such as:

  • Diminished gas and oil flows from Russia
  • French nuclear reactor challenges
  • The growing presence of intermittent renewable energy sources in the market system

These factors have resulted in extreme market volatility and escalating power prices to record levels.

In related news, traders at Danish energy firm Energi Danmark Group, one of the country’s largest energy companies, were dismissed for refusing to return bonuses worth roughly $44 million (DKK 300m) amid market price surges and heightened instability.

The Handover of the Investigation

The Danish Supply Authority has handed the investigation to the National Unit for Special Crime, which specializes in complex economic crimes.