Feds subpoena Chesapeake Energy over accounting practices

Feds subpoena Chesapeake Energy over accounting practices
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Chesapeake Energy Corp. has received a federal subpoena as part of a Justice Department investigation into its acquisition and classification of oil and gas properties. 

The company revealed the subpoena in a regulatory filing on Thursday, saying it focuses on “possible violations of federal and state antitrust laws relating to our purchase and lease of oil and natural gas rights in various states.”

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Officials with the Department of Justice, U.S. Postal Service and state governments are also seeking information on Chesapeake's royalty payments, the company said.

“We have engaged in discussions with the DOJ, U.S. Postal Service and state agency representatives and continue to respond to such subpoenas and demands,” it wrote in its filing with the Securities and Exchange Commission.

Chesapeake, one of the country’s largest natural gas companies, has claimed $16 billion in impairments — an accounting term meaning reduced asset value — on its oil and gas proprieties since 2015, according to Bloomberg data

The company, which is dealing with low crude oil and natural gas prices, is considering paring down its other assets after reporting losses for six straight quarters, Bloomberg News reports. 

The company’s stock was down more than 7.5 percent on Thursday afternoon. It took another hit earlier this week when investor Carl Icahn resigned from the company’s board on Tuesday, Business Insider reports.