On November 3, 2014, FERC's Office of Enforcement ("Enforcement") issued a Notice of Alleged Violations against Maxim Power Corporation ("Maxim"), suggesting that Maxim engaged in three schemes in ISO-New England ("ISO-NE") that violated section 222(a) of the Federal Power Act and FERC's Anti-Manipulation Rule, 18 C.F.R. § 1c.2.
The November 3 notice alleges that between 2012 and 2013 Maxim abused an ISO-NE rule that was intended to mitigate the market power of generators needed for reliability, fraudulently receiving inflated make-whole payments from ISO-NE. Additionally, between July and August of 2010, Enforcement alleges that Maxim falsely reported higher fuel costs based on a reported need to use oil due to gas supply problems despite actually using lower-priced gas as fuel. Finally, from 2010 to 2013, Enforcement alleges that Maxim artificially raised the output of three of its plants during capacity tests in order to receive inflated capacity payments from ISO-NE.
The November 3 notice also suggests that certain Maxim executives participated in some portion of the fraudulent activities.
To view the notice, click here.
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