The U.S. Federal Energy Regulatory Commission, or FERC, on Monday, formally accused JPMorgan Chase & Co. (NYSE:JPM) of manipulating electricity markets in California and the Midwest between September 2010 and June 2011, ahead of finalizing a financial settlement reported to be in the works between the company and regulator.

FERC’s notice of alleged violations -- seen mainly as a formality that discloses details of the investigation to the public -- accused a JPMorgan trading unit of engaging in eight manipulative bidding strategies, Bloomberg reported.

The notice came after weeks of media reports that JPMorgan is close to agreeing on a deal with FERC, including a fine of at least $400 million.

JPMorgan declined to comment on the notice, news reports said.

In a move that came as a surprise, JPMorgan, on Friday, said it will wind down its physical commodities trading business, saying it planned to pursue “strategic alternatives,” adding that the bank was “fully committed” to its traditional financial commodity business, including derivates and precious metals trading.

JPMorgan is accused of selling electricity at false prices to state authorities in Michigan and California, and of extracting excessive payments, which drove up electricity prices. JPMorgan acquired the rights to sell electricity from power plants through its 2008 takeover of Bear Stearns.

Blythe Masters, JPMorgan’s commodities chief and a top Wall Street figure, was earlier rumored to be facing the risk of being singled out by FERC, but Monday’s notice did not name her or any other JPMorgan traders of conducting illegal trading.

The notice, signaling greater regulatory pressure on energy traders, came two weeks after FERC upheld a record fine of $487.9 million on Barclays PLC (NYSE:BCS) and four of its former traders for allegedly manipulating energy markets.

Barclays said, at the time, that it will take the legal route to resolve the case, which is expected to be a major testing ground of FERC’s regulatory powers after it received a major power boost from the Energy Policy Act of 2005, which was put in place following the Enron scandal.