September 18, 2008

 

 

Requested Client Action Information Only

Categories

ISO News and Information

Legal/ Regulatory

Settlements and Market Clearing

 

 

Further Enforcement Action Against Lehman Brothers Commodities Services, Inc

 

___________________________________________________

 

Summary

The CAISO has taken further enforcement action against Lehman Brothers Commodity Services, Inc by issuing a notice of default.  

___________________________________________________

 

Main Text

The California ISO (CAISO) has taken further enforcement action against Lehman Brothers Commodity Services, Inc by issuing a notice of default on September 23, 2008 upon its failure to post requested additional financial security within five business days of CAISO request (See previous Market Notice at

http://www.caiso.com/2047/2047ce07345f0.html).

 

Pursuant to Section 12.4.1 of the CAISO Tariff, a Market Participant must post additional financial security within five business days of CAISO request.  Pursuant to Section 4.5.4.4 of the CAISO Tariff, Lehman Brothers Commodity Services, Inc is now in formal default of its tariff obligation to meet the financial requirements of Section 12.  If LCBS fails to remedy the default within five business days, the CAISO will issue a notice of termination pursuant to Section 4.5.4.5. 

 

This action notwithstanding, the CAISO does not consider Lehman Brothers Commodity Services, Inc or any other Market Participant to be a material source of unmitigated default exposure to the CAISO market.

 

For more details concerning the circumstances leading to CAISO enforcement actions against Lehman Brothers Commodity Services, Inc, please see "Events Leading to Suspension and Default of Lehman Brothers" at http://www.caiso.com/204d/204d8633387d0.pdf.

___________________________________________________

 

For More Information Contact

Phil Leiber at (916) 351-2168 or PLeiber@caiso.com

September 18, 2008

 

 

Requested Client Action Information Only

Categories

ISO News and Information

Legal/ Regulatory

Settlements and Market Clearing

 

 

Further Enforcement Action Against Lehman Brothers Commodities Services, Inc

 

___________________________________________________

 

Summary

The CAISO has taken further enforcement action against Lehman Brothers Commodity Services, Inc by issuing a notice of default.  

___________________________________________________

 

Main Text

The California ISO (CAISO) has taken further enforcement action against Lehman Brothers Commodity Services, Inc by issuing a notice of default on September 23, 2008 upon its failure to post requested additional financial security within five business days of CAISO request (See previous Market Notice at

http://www.caiso.com/2047/2047ce07345f0.html).

 

Pursuant to Section 12.4.1 of the CAISO Tariff, a Market Participant must post additional financial security within five business days of CAISO request.  Pursuant to Section 4.5.4.4 of the CAISO Tariff, Lehman Brothers Commodity Services, Inc is now in formal default of its tariff obligation to meet the financial requirements of Section 12.  If LCBS fails to remedy the default within five business days, the CAISO will issue a notice of termination pursuant to Section 4.5.4.5. 

 

This action notwithstanding, the CAISO does not consider Lehman Brothers Commodity Services, Inc or any other Market Participant to be a material source of unmitigated default exposure to the CAISO market.

 

For more details concerning the circumstances leading to CAISO enforcement actions against Lehman Brothers Commodity Services, Inc, please see "Events Leading to Suspension and Default of Lehman Brothers" at http://www.caiso.com/204d/204d8633387d0.pdf.  ___________________________________________________

 

For More Information Contact

Phil Leiber at (916) 351-2168 or PLeiber@caiso.com