{"id":6287,"date":"2012-05-03T10:33:19","date_gmt":"2012-05-03T15:33:19","guid":{"rendered":"http:\/\/stateimpact.npr.org\/oklahoma\/?p=6287"},"modified":"2012-05-03T10:45:48","modified_gmt":"2012-05-03T15:45:48","slug":"aubrey-mcclendon-says-hes-sorry-senator-asks-doj-to-probe-chesapeake-energy","status":"publish","type":"post","link":"https:\/\/stateimpact.npr.org\/oklahoma\/2012\/05\/03\/aubrey-mcclendon-says-hes-sorry-senator-asks-doj-to-probe-chesapeake-energy\/","title":{"rendered":"Aubrey McClendon Says He\u2019s \u2018Sorry,\u2019 Senator Asks DOJ to Probe Chesapeake Energy"},"content":{"rendered":"
\"\"<\/a><\/p>\n

Scott Detrow \/ StateImpact Pennsylvania<\/p>\n

\n<\/div>

Chesapeake Energy CEO Aubrey McClendon opened Wednesday\u2019s first-quarter earnings call with an apology for \u201cdistractions\u201d caused by questions into his personal loans.<\/p>

McClendon secured those loans \u2014 up to $1.1 billion, Reuters reported<\/a> \u2014 with well stakes, which he acquired through a controversial CEO perk that allowed him a personal stake in every well Chesapeake drilled.<\/p>

What McClendon didn\u2019t mention: a $200 million hedge fund, which Reuters says<\/a> he ran from inside Chesapeake.<\/p>

<\/p>\n

Analysts did not ask any questions about potential conflicts during the 90-minute call with McClendon, reports<\/a> The Oklahoman\u2019s Jay Marks.<\/p><\/blockquote>

But others have questions, including U.S. Sen. Bill Nelson, D-Florida, who\u2019s asking<\/a> the Justice Department to investigate for potential fraud and price manipulation.<\/p>

Chesapeake’s stock fell<\/a> almost 15 percent Wednesday after the hedge fund news and a disappointing earnings report.<\/p>

McClendon wouldn\u2019t comment to Reuters. The other hedge fund principal, Tom Ward \u2014a Chesapeake co-founder and current CEO of SandRidge Energy \u2014 said<\/a> there was nothing wrong with the hedge fund arrangement.<\/p>

There\u2019s no evidence that either used inside knowledge, but Forbes<\/em>\u2019 Christopher Helman says the hedge fund, which wasn\u2019t disclosed to shareholders, appears to violate McClendon\u2019s fiduciary duty to Chesapeake. In short: Shareholders\u2019 interests come first, Helman writes<\/a>:<\/p>\n

If the co-founders of the company identified new ways to profit from trading natural gas, why didn\u2019t they present that opportunity to the company instead of keeping it for themselves?<\/p>

This has raised a host of questions. Did they profit off of non-public information about Chesapeake\u2019s trades? Were they front-running? Did the hedge fund pay rent to Chesapeake for being allowed to operate from a Chesapeake building?<\/p><\/blockquote>

Private investments \u2014 restaurants, real estate, NBA teams \u2014 are one thing, Helman argues:<\/p>\n

But when a business opportunity involves natural gas, and the opportunity is pursued from within Chesapeake\u2019s offices, it seems like shareholders have been cheated.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

Chesapeake Energy CEO Aubrey McClendon opened Wednesday\u2019s first-quarter earnings call with an apology for \u201cdistractions\u201d caused by questions into his personal loans.McClendon secured those loans \u2014 up to $1.1 billion, Reuters reported \u2014 with well stakes, which he acquired through a controversial CEO perk that allowed him a personal stake in every well Chesapeake drilled.What […]<\/p>\n","protected":false},"author":36,"featured_media":6291,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[301],"tags":[360,275,276,365],"acf":[],"_links":{"self":[{"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/posts\/6287"}],"collection":[{"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/users\/36"}],"replies":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/comments?post=6287"}],"version-history":[{"count":1,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/posts\/6287\/revisions"}],"predecessor-version":[{"id":6290,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/posts\/6287\/revisions\/6290"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/media\/6291"}],"wp:attachment":[{"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/media?parent=6287"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/categories?post=6287"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/oklahoma\/wp-json\/wp\/v2\/tags?post=6287"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}