Chief Justice John Roberts
Supreme Court of the United States
1 First Street, NE
Washington, D.C. 20543
January 8, 2018
Re: Corrupt Senior District Court Judge Denis Hurley ( 10-CV-5567)
I have written to both yourself and Justice Ginsburg about Chief Judge Robert Katzman before. So, there is not much a citizen can do lawfully to hold accountable bad behavior of bad actors in Government. For over a decade now I have decided to use language as a formal protest to corruption and have littered the courts with pleadings as witness to bad actors in real time.
Formally, I have written the Senate Judiciary Committee. I have pursued other actions a citizen can think of to bring awareness and attention to corruption. You all don’t think you’re corrupt? The United States over the last 30 years has imprisoned the most people since the history of the world. Federal Courts have a 98% conviction rate. 91% of Defendants plead guilty rather than go to trial because the penalties are too severe. Any person who has been a part of the last 30 years will go down in history as being a majority part in the destruction of what was a great nation.
There are lots of blame to go around and lots of corrupt people, but Denis Hurley is a step above. He blatantly disregards the law and seemingly gets away with it. Lawfully anyway.
Hurley was handpicked by the Government to oversee a criminal and civil case of mine back in 2010 and 2011. It is a long story which I won’t get into here, but the CFTC and NFA have targeted and pursued me since 1997. For purely personal vendetta.
In December 2010 the CFTC charged my company for a ‘simple registration violation” for a hedge fund I operated in 2008 and 2009. The fund itself was very successful with a net audited 138% return during 19 months. Because of the oppressive pursuit by the SEC and CFTC I was forced to close down my successful fund and lost my ability to make a living. The CFTC’s case was that for 3 months in 2008 the fund was not registered or exempted from registration properly. With all that was going on during this time it is simply ridiculous this type of case was even pursued while so many critical issues with the capital markets should have been a priority. As they do 97% of the time to small companies, the CFTC also charged me personally as a “control person” although did not submit one iota of evidence I acted in bad faith which was their burden.
My response to this personal vendetta led to criminal charges. Immediately I had asked Hurley to recuse himself from one of the cases so I could have a chance for an impartial and independent tribunal in at least one of my cases. For the last 7 years I have sought his recusal numerous times with no success. I even submitted multiple Judicial complaints with the second circuit. That’s where my complaint with Chief Judge Robert Katzman and Clerk of the Court Catherine O’Hagan Wolfe come in to play. For 2 years they sat on the complaint and admitted they “made a mistake” by not submitting the complaint to the Judicial Council. I got a form letter 2 years later from Wolfe stating that regardless of their mistake, they denied my petition, but not naming who made that decision. So, it was either Katzman who I explicitly requested be removed from any decision making, or it was Wolfe herself making judicial decisions on her own. Either way, it was blatantly corrupt.
In all that time over 7 years, Hurley always stated in both cases, “he could be fair and impartial”. This was a blatant lie. How do I know? Because on August 15, 2015 he admitted in open court he had always been partial and biased. He threw me in prison unlawfully for either helping a young man with legal work, or protected speech that he himself ruled was protected speech. Any way you want to look at it, I spent 10 months in federal prison unlawfully by a biased, corrupt Senior Court Judge who seemingly is going to get away with it.
The CFTC civil case is even more troubling and more corrupt than even the criminal case. Never in the history of the CFTC 40 years have they ever brought singularly a registration case directly to federal court. I have been defending myself somehow over the past 7 years and it has cost me and my wife tens of thousands of dollars to retain representation for the corporate entities alone. The only other comparable case was in 2003 when the CFTC brought and settled a registration case to its Administrative Court in the same month!
My attorney told me in February 2011 I would not get a fair trial in the criminal case as long as Hurley was the Judge. How right he was. It is why I plead guilty although I was innocent. In the fall of 2016, I was disgusted and fed up with the civil case and was advised to sign a consent order for mostly the same reason, Hurley would never ever allow this case to even get to a trial. Basically, I was extorted to sign the consent order neither admitting or denying the allegations. Part of the agreement was that Magistrate Tomlinson would decide the penalty phase. She is no saint herself signing either an arrest or search warrant to the home of my ex wife where I did not live in 4 years and was ten thousand miles away in Singapore in 2010. The FBI interrogated my 19-year-old daughter who was home alone from college which was the main reason that led to the criminal charges.
In May 2017 I wrote a penalty phase brief to Tomlinson which you can read for yourself. Although I had agreed with the CFTC that Tomlinson would decide this phase, the CFTC was still writing to Hurley. My corporate attorney noticed this and requested the Court to verify who was going to decide the penalty phase. Hurley incredulously wrote that Tomlinson’s case load was too busy and he would decide the case essentially violating our agreement. I knew the CFTC and Hurley had been speaking unlawfully ex parte as he had admitted in the criminal case so this was no surprise. Obviously, I knew Hurley was just going to continue acting unlawfully and basically doing whatever he wanted to do without lawful action. It is now 8 months later so we all know now the Tomlinson case load excuse was bullshit. Had it not been for my corporate attorney, Hurley would have tried to hide in the dark and not say a word.
This case should have been thrown out years ago. It is certainly a clear waste of taxpayer money. It has no impact on the markets or society in any way. There are zero victims and actually the investors did quite well. This case is pure personal vendetta by the CFTC and NFA and they have retained a corrupt Senior District Court Judge in Denis Hurley as their hitman. Period.
My brief includes a plethora of evidence of good faith efforts by myself and all the administrators, attorneys, auditors, banks, clearing firms etc. to comply with all rules and regulations. It also cites the only comparable case which the principals were NOT charged as control persons, their entity was fined $10k, and they were allowed to register and continue with their business for 5 years subsequently. I am bankrupt and both the Court and CFTC have been in possession of financial affidavits detailing my financial situation. The two corporate entities were closed in 2011.
The only real issue would be allowing an unprecedented violation of law by a corrupt Judge that other defendants could be liable which would be anti-competitive and have huge ramifications for future innocent, innocuous violations. Despite that cited case, the CFTC wants unprecedented civil fines despite law that it must not request monetary penalties the Defendant simply cannot pay or afford. It also wants an incredible lifetime personal trading ban. Just recently I read a SDNY case, CFTC v Fan Wang, (16-CV-6961, 8-8-2017) which that Judge correctly interpreted the law. The Court gave a very well thought out discussion on the law of a defendant’s ability to pay and stated, “the Courts should be realistic and not set a figure which is impossible for a defendant to comply with due to lack of monetary resources.”
Even more incredibly Wang was caught trying to place losing trades in customer accounts. It is an egregious violation. He also faced criminal charges. Despite the Government seeking 3 plus years incarceration under sentencing guidelines, Judge Pauley departed and gave Wang 3 months. In the CFTC civil case against him, the CFTC wanted a $2,2 restitution, over $360k in fines and also lifetime trading and registration bans. Judge Koetl denied most of the CFTC requests, cut the fine in half and did not allow for trading or registration bans. Wang’s case was brought in 2014, he has served all of his prison sentence and both his civil and criminal cases are finished and he will be allowed to register and trade again for egregious violations that directly impacted customers and the markets. Yet, my civil case just entered its eighth year for a simple registration case that impacted no one? And Hurley sentenced me to 10 months in prison for either helping a young man with legal work, or for protected speech? You pick but both ways you look at it was unlawful.
One of my favorite sayings is, “sunlight is said to be the best disinfectants” by Louis Brandeis. He wrote it in 1884. He had not been a reformer or activist, but as a lawyer over time representing clients, brushed up against corrupt Government officials. He had written years earlier privately about corrupt Government officials; “about the wickedness of people shielding wrongdoers & passing them off (or at least allowing them to pass themselves off) as honest men.” Denis Hurley is the poster boy to what concerned Louis Brandeis. His words are as relevant now as they were in 1884.
I am not writing you to do anything. No, I am 20 years smarter now. I know you mother fuckers aren’t going to lift a finger. I have historically written as testimony to our times and for the record so all people will know the pain and suffering me and my family have suffered at the hands of corrupt Government officials. I wrote one time, “don’t underestimate one disgruntled mother fucker. That would be a mistake.” AUSA Chris Cafferone, Loretta Lynch and the DOJ actually charged me under “true threats” for that sentence.
But the sunshine is coming. I am the sunshine. I am the disinfectant.
Forbes magazine is doing a 5-part expose on my 20-year experience with corrupt Federal Officials and various Federal Courts that deny due process and justice. One article with be dedicated to Denis Hurley and his corruption and also to Judge Roberts, Robert Katzman, Judge Ginsburg, Rena Raggi, Catherine O’Hagan Wolfe and others who didn’t lift a finger to stop it. As twice survivor of WTC attacks and losing 23 friends on 9/11, hopefully my story will further resonate with people about a career and life destroyed for sport. In addition to that expose, I will be doing a 2-year tour of conferences in regards to corruption in the federal courts. I will be speaking to Universities, business conferences and American Bar Association events. I will make Denis Hurley the poster boy for Judicial corruption. I will make him famous. There are discussions about books, documentaries and feature films. I will be putting this letter on my website.
You cannot say you haven’t been warned about corruption in the EDNY or Second Circuit Court of Appeals. This letter and 20 years of letters and pleadings are also your evidence.
Vincent McCrudden – President
Project For Government Reform
3942 Hillstead Lane
Jacksonville, FL 32216
Judge Ruth Bader Ginsburg
Catherine O’Hagan Wolfe
Today, Stevie Cohen has been given his license back from the Government to steal further from legitimate investors. His firm, SAC Capital had 9 employees convicted of insider trading which doesn’t count numerous others who left SAC who learned how to steal on inside information and were convicted when employed at other firms. In 2014, Stevie neither “admitted nor denied” allegations of failure to Supervise and settled with the SEC and CFTC to pay a $1.8 billion-dollar settlement and was not allowed to trade customer money for 2 years. How does anyone not guilty write a check for a whopping $1.8 billion dollars? Not anyone who earned it legitimately. Its like asking the bank robber who stole $1mm to give back $200k.
Stevie is “protected”. He is one of the largest owners of art in the world with his ill-gotten gains. First and most importantly he employs ex DOJ and SEC lawyers. This is the very first key to operating a criminal enterprise. Want another example, how about Ray Dalio hiring “lifer” Government bureaucrat James Comey. What added value could Comey possibly add a money management firm other than protection from prosecution? Why is this important? Because present SEC and CFTC officials also want a life after public service and its critical for career and money for them to have firms they can work with later on. This revolving door of public/private service is the key to the criminal enterprise of “regulatory capture” which allows the Stevie Cohens and Ray Dalio’s of the world to operate, and for small firms to be banned from business. Financial Regulators need convictions for their present jobs, so they unfairly target small firms for convictions for relatively small amounts of money, while hundreds of billions are siphoned off each year from the big firms.
Secondly and also important, Stevie is protected from the larger bulge bracket firms like Goldman Sachs and Morgan Stanley. Here’s how he operates and how he has been able to generate outstanding risk adjusted rates of return for so many years. Stevie gets a call from Goldman looking to sell a large quantity of IBM for example. Goldman has gotten its order from a huge pension or money management firm like Vanguard or Putnam. Goldman has now just basically given Stevie, “material, non-public information.” They do so under the guise of “seeking liquidity”. Stevie hangs up with Goldman and then calls Morgan Stanley and tells them to sell 250k shares of IBM short. Of course, he always has “borrowed” the shares in advance…not. Once short, he then calls back Goldman Sachs and says he will buy back the last 250k shares. He has just committed a crime and colluded with Goldman and Morgan Stanley to do it. The problem is this type of criminal behavior is never prosecuted. Stevie knows the business in and out because that’s what he did as a broker before he became a hedge fund manager. IBM shares dropped $2 in the course of a half day and Stevie pocketed $500k. He paid the highest commission on the street at .05, so he paid his partners in crime Goldman and Morgan Stanley $12,500 each. Stevie, Goldman and Morgan Stanley and others do this each and every day numerous times. Who pays for it? The public and unknowing investor. It is partly the reason why large investment firms underperform the market because the “vig” to trading is costly. Stevie can now count on making hundreds of millions a year basically risk free. On top of this type of trading, because he is the biggest customer on the street, he gets research information first and also first dibs on hot IPO’s and secondary’s. This is why his risk adjusted rates of return are so good. Yes, he also takes risk on biotech’s and other high volatility stocks, but only as a way to launder the money he made unlawfully.
Stevie is the worst violator of this methodology and has been for 30 years, but many others cheat too. When Stevie was in his 2-year hiatus, he was still managing his own personal fortune of $10 billion dollars and made that $1.8 billion back very quickly. The bulge bracket firms made sure of that. Although his firm was called a “criminal enterprise” by USAG Preet Bharara, Stevie Cohen was never charged as a “control person” like so many others, including myself.
In 2011, I was charged by the CFTC for operating my hedge fund without being registered or exempted from registration properly. Their case was that for 3 months in 2008, my fund traded futures improperly. But the fund had made a 138% net audited return for 2008 and 2009 and both the SEC and CFTC subpoenaed records and pursued me like I was a criminal and forced me to close down my successful fund. I was also charged personally as a control person although the retainment of my lawyers, administrators, auditors showed good faith efforts to comply and it was the Government’s burden to show bad faith. My response to this personal vendetta led to criminal charges. When released, I sought to simply trade my own capital so I could make a living. 17 clearing forms rejected my ability to simply trade my own money and I sued them in federal court. As mentioned above, Stevie Cohen can trade with the most “prestigious” firms in the world, but a small guy like me can’t even open a trading account? And now Cohen can trade customer money again while my “simple registration violation” case is STILL in federal court entering its eighth year?
I am not alone as many small businessmen are put out of business while someone like Cohen or Dalio are allowed to not only continue to compete, but cheat and make billions of dollars. Cohen is expected to raise $3-4 billion dollars immediately. How? Because his investors will come from Goldman Sachs and Morgan Stanley who know he cheats, but he is their cheat, so its ok.
Judge Laura Swain signed off on Cohen’s agreement. She has thrown out, as well as Judge Pauley, lawsuits I submitted to bring attention to disparities like this. When I used harsh language to Judges like these, they simply gave the letters, all protected speech, to the FBI and US Marshals and I was sent to prison for 10 months unlawfully by another corrupt Judge, Denis Hurley of the EDNY. Meanwhile protected criminals like Cohen are living large and will never see a day in prison. Good thing because he would never last a day.
I bring this up because I have witnessed and experienced firsthand the inequity of how large firms versus small firms are treated which ultimately leads to anticompetition and wealth disparity we have today. For me, I always operated and competed honestly and fairly. But yet, I am unemployable somehow. This type of crap always has a reckoning. I hope I am around when it happens.
Joe Bag O’ Donuts from Staten Island starts an investment firm. He may or may not register it with regulatory authorities. He hires his buddies from the streets and are awesome, aggressive salesman. They get a little money together and buy some crap company on the pink sheets, and then market the crap out of it. They sell it to Senior citizens living in Florida and the stock they bought at .10, now sell at $2.00. They duplicate and repeat this model until the authorities come calling. They will of course face the two-headed monster of both civil and criminal charges and the Government will seize every asset in their name, hold auctions at a later date and sell the assets to insiders for pennies on the dollar. The regulators will set up restitution, but victims will have to jump through hoops to get any of the money after the Government and lawyers get their piece from it. Whatever is left over after about 7 years goes to the US Treasury.
Bitcoin is that once a decade scam that the wealthy, rich and powerful play. From the anonymous programmer who initiated it, to the Winkelvoss twins, to Congress, to regulators, to exchanges, it is the perfect scam. Now, the Winkelvoss twins are not from Staten Island. No, they are from Harvard and wealth and their scam will not end them in prison or anywhere near what Joey Bag O Donuts would go through. But make no doubt, the few millions Joey steals will be nothing compared to the hundreds of billions the Winkelvoss and others steal. All the global scams and shutdowns of exchanges will not stop the wealthy and power in this country from proceeding with this scam. In fact, the Courts and criminal justice system and lawyers are counting on it to place the mostly poor and misguided in prison for draconian amounts of time and take every asset from them. The Winkelvoss twins and all the financial institutions that perpetuate the scam? Not so much.
So, to all of my small businessman and middle-class friends here’s my advice. Bitcoin is going much higher. Buy it now if you haven’t bought it already. It is going to at least $75k. We are going to participate in this scam too, but are going to get into this crap and make money too. Bitcoin is still relatively closely held and now with the initiation of exchange trading, that is going to get worse. Through margin trading, institutions and the wealthy will scoop this up. Right now, the margins are about 40% so you can buy a bitcoin contract and control $18k with about $7k. The margin will go lower because the CME and other monopolies and regulators make money on number of contracts traded, period! Eventually, you will see state sponsored short squeeze like you have never seen before.
It is the ultimate pump and dump, but will last many years. So, with this new fiat currency what will also be affected? Sell Gold and Silver. Gold is going to at least $800 and the heavily manipulated Silver is going to at least $8. Jamie Dimon has made negative statements about bitcoin because he doesn’t want to see an alternative to the monopolies he has with Gold and Silver and other precious metals that JP Morgan has been manipulating and stealing money for years! As for currencies? The US Dollar is a fiat currency, just like bitcoin. With $21 trillion dollars of debt, the rich have already stolen and siphoned off of generations of wealth in just 20 years. They have no intention of paying off the debt and it’s the major reason why bitcoin is a play. The problem with fiat currencies is that they trade in pairs, so its like comparing the tallest midget. We are all mandated to play with the piece of shit the Government makes us play with. So, whether is the Yuan, US Dollar, British Pound and Euro, its like picking your poison on which piece of shit defaults first. You say the ratings agencies should start to at least to downgrade and warn the public about the probabilities of default? Try asking how S&P did when the downgraded US debt and the real mafia, the DOJ came calling.
So, my friends, lets make some money and get ahead of the real mafia in this country, the wealthy and the elected officials that do their bidding. When will be the time to sell and go short? When you see CNBC and Jim Cramer have guests on like Robert Steele and Erin Callan to say how great bitcoin is and the senior citizens of Florida should buy it, that's your clue!
In 2 weeks from now, it will be 7 years since I was charged by the CFTC for a ‘simple registration violation”. My company and I were sued for $58mm and I was charged personally as a “control person”. The CFTC posted the lawsuit on their website and a few media published it. My fund had made a 138% net audited return I the 19 months I ran it and it was small, only $15mm AUM at its peak. Because of SEC and CFTC subpoenas in August 2009, I was forced to close the fund in December 2009.
The CFTC filed their lawsuit on December 1, 2010. It was the very first time in the 40 years history of the CFTC had they went directly to federal court for a singular registration allegation. I was in Singapore at the time as I had been a target of US Financial Regulators for many years already. After I saw the lawsuit, I wrote a few things on my website about it. But not until December 19, 2010 when the FBI raided the home of my ex-wife and interrogated my 19 year old daughter who was home alone from college did I escalate my language on my website. I had separated from my wife in 2006 and had not lived there since then, but the media never cared about that. What the media cared about was on January 14, 2011, I was arrested by 40 armed federal agents directly off the plane from Singapore. The media gravitated towards my website posting of an “Execution List” written on that day, December 19. By law, that posting alone is and was protected speech. But people like Kaja Whitehouse and Bess Levin wrote that I was some type of rogue hedge fund manager who did something egregious and then threatened innocent, poor Government regulators. That’s sexy. That sells. The truth not so much.
Being the astute “investigative” reporters you all are, don’t you think it’s odd that the original simple registration case is still pending nearly 7 years later?
Since 2011, there have been a few high profile US Financial Regulatory cases. Stevie Cohen and SAC. Anthony Chaisson, Todd Newman, Mark Cuban, David Ganek and Lynn Tilton to name a few. All of them have a few things in common. They are all wealthy. They all had the ability to hire top lawyers. Most of them tried to sue the Government under the Federal Tort Claims Act and Bivens claims against individual officials. All those cases were thrown out. So, although they were “innocent”, no one in Government lost their jobs, paid any fines or was held to any liability for ruining these peoples careers, lives and reputations. But they are still all rich. They all have PR firms who work with all of you to write about how wronged they were. Most of them Ivy League graduates.
What I represent is the voiceless of tens of thousands of small businessmen and women who lost their careers and lives and who have done far less egregious violations than the people above. How am I different than the people above? Well for one, I am broke. I haven’t been able to make a living the past 8 years. I have even been denied the ability to open my own trading account. I can’t even drive for Uber.
I did some research on the US Financial Regulator, the Commodity Futures Trading Commission. (CFTC.). Here are some facts:
( I have included my Pro Se brief in my case which is about to enter its eight year.)
Now, take a look at the “rap” sheet of XYZ Company:
Violation Tracker Parent Company Summary
Parent Company Name:
publicly traded (ticker symbol XYZ
banking & securities
Penalty total since 2000:
Number of records:
Top 10 Primary Offense Types
Number of Records
toxic securities abuses
False Claims Act
foreign exchange market manipulation
consumer protection violation
investor protection violation
securities issuance or trading violation
energy market manipulation
This “XYZ Company” has paid almost $30 billion in fines over the past 15 years. They have even been found guilty of foreclosing on houses and repossessing the vehicles of our soldiers while they have been away fighting for our country.
Who is XYZ Company? JP Morgan Chase. And it’s main ‘control person”? Jamie Dimon who is lauded in the media as a fucking financial guru. In all of those fucking cases of the worst financial violations you can imagine, not once in all those cases was anyone at JP Morgan charged as a control person. Some “phantom” person violated the law and the shareholders paid the fines as a “cost of doing business.”
I thought I would share my thoughts as my case got closer to 7 years. Of course I ended up doing 3.5 years in federal prison, but never stole a penny or harmed another human being, but that’s not sexy right? The corrupt Judge sitting on this case, Denis Hurley, sentenced me to 10 months in federal prison for simply helping an inmate with legal work in 2015. Of course he used that as an excuse to suppress my First Amendment Rights. This is all on the docket of course, but I know you are all busy writing about Trump or Kim Kardashian to do any real investigative research. Hurley has been sitting on this case for 7 years. I am sure he’s up to no good and trying to figure out a legal way to fuck me once again. Of course he knows now he will be protected by the media.
I started my Wall Street career in 1985 on the floors of the Commodity Exchange. During the last 30 years, I have watched the markets nearly every single day. I have always studied correlations and tried to analyze what markets moved compared to economic news and trends. In my entire career, I have never witnessed more collusion, spoofing, manipulation, frontrunning and cheating as I have seen this year.
Let me first address the complete comfort and knowledge of earnings prior to release. Stocks are moving violently into earnings. Stocks are moving higher when expectations are positive and get rewarded almost 100% of the time at announcement. The same can be said for stocks that move lower and then dive further I don’t care how you look at it, it is a violation of law of trading on inside information on material information. Hundreds of millions of dollars are being made every earnings cycle just on this alone. Usually, ivy league analysts are sharing info with their ivy league butt buddies without fear of prosecution.
The biggest fraud going on this year is the near perfection of spoofing and manipulation of all asset classes by algorithms. Many guys I have worked with over the years have tried their hand trading the past few years. I don’t know of a single person who can compete with these new algorithms. Let’s take a look at a few things:
Volatility the whole year has been at historic lows for almost every asset class. Let me explain why. Even back in the 1980’s when hedge funds and commodity pools were expanding, 10% of the largest money managers managed over 80% of assets under management. Financial engineering starting with regular Black Scholes options have morphed into barrier options and all kinds of instruments that bulge bracket firms have created to steal money. Because these firms like Goldman and Morgan Stanley can fund lower than anyone else in the world, they can sell volatility all day and then pair them off creating a derivative domino effect that no one can fully calculate. We know now they bare no risk because they have already been bailed out, so they aren’t held accountable like a small firm would be. Because you have so low a volatility, may firms buy vol and then try and trade gamma around it. Billions of dollars are held in low vol positions and most algorithms hedge the gamma the same way, so it’s almost impossible in the current environment for any asset class to break out either way as any move is met with tremendous volume. Also, because so many assets under management are held by a small number of firms who trade vol. lower vol is almost self-fulfilling. It’s like playing unlimited poker with a billionaire. Despite your hand, you will have to fold.
Now, these are the real criminals today. Remember Bernie Madoff? For years he ran a Ponzi scheme showing outstanding risk adjusted rates of return. Many people believed he was front running orders from his broker dealer. So, they knew he was cheating, but invested anyway. Of course, many cried like babies years later when they were had, but they had thought they were the ones benefitting from fraud and cheating. In the rush to great outstanding risk adjusted rates of return, along came programmers who would back test their “models” to show great risk adjusted rates of return to get funded. The first person to really take advantage of front running orders was Jim Simons from Renaissance Technologies. He figured out that he could get all the information from the open book on the NYSE and from there, well, a business was born. You will never hear him talk about economics or trends or anything. Why? Because he doesn’t give a fuck and all they care about it is stealing and front running orders. Stevie Cohen and his gang do the same thing, but they relied on paying top dollar for information real time that was given to him by bulge bracket brokers. He had great risk adjusted rates of return for the same reason Simons did, but just done without technology.
Simons created a rush for other firms to copy and that’s what we have today. These small number of firms dominate the industry and steal, spoof, manipulate and front run orders every minute of every day. You say where are the regulators? As usual, under regulatory capture, they are in on it just as long as these firms hire them and pay them millions later on. Just watch any given day in the major futures markets. These algorithms have basically destroyed the heavily traded S&P emini’s. There is some volatility around 9:30am when the market opens, and then usually dies around 11am when there done. Why do they move? Because mostly they know and have paid for information as to where all the positions are. They specifically are interested in the weak hands and small investors positions. They target them specifically and know where there leverage ends and where three stops are and they attack those positions until they have it all. Even highly correlated contracts like NDX and Dow can go different ways some days so they can steal on both sides. They will constantly manipulate other asset classes to make it look a certain way, only to then violently change course and place huge amounts of orders to fuck everyone in their path. Scumbags like Interactive Brokers sell information to companies and firms like this in real time so they can fuck their own small customers. IB has also perfected the ability to give small investors leverage intraday, only to pull the rug from them electronically at 3:50pm, 10 minutes before the close. That’s why you will see violent moves on the close as all those small investors are liquidated automatically to get back under margin. After 5pm when the futures markets close for the day and the algorithms shut off, watch the futures markets at night. There are no traders anymore. I have seen the heavily traded S&P trade within a single point for up to 12 hours. This new era of “gap and sit” is here to stay.
The pension funds and sovereign funds who invest in these funds like Bridgewater Associates are cannibalizing the industry. Everyone is happy when the markets are being manipulated higher, but the real money will come when these algorithms come looking to squeeze 401k’s and pension money. These daily “flash” trades will be nothing compared to what’s they will do in the future when the markets start to fade and people actually will start to try and sell stocks. Good luck. That day is coming sooner than later. These “mining” strategies do not add value to society. They are only adding to the wealth disparity. They do not create jobs and in fact, destroy jobs. They don’t “invest” with companies for long periods of time for research and development. Hell, they don’t even know or care what these companies do. All they care about is stealing.
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
United States Commodity Futures Trading Commission v. Vincent McCrudden, Alnbri Management, LLC and Managed Accounts Asset Management, LLC Defendants
May 10, 2017
Penalty Brief for Defendants
Vincent McCrudden – Pro Se
3942 Hillstead Lane
Jacksonville, FL 32216
Michael Peter Kushner – Attorney
Defendants Alnbri Management, LLC & Managed Accounts Asset Management, LLC
Kushner Law Group
16 Court Street, Suite 2901
Brooklyn, NY 11241
After seven years of litigation, the Defendants hereby state that Defendant Vincent McCrudden is not liable as a control person, and therefore not liable for any penalties including monetary fines, trading or registration bans. Defendants Alnbri and MAAM could be deemed liable for trading exemption violations, but only one case could be found that the Court could refer to for any penalty, but the unlawful process the CFTC and other regulators pursued already has punished the corporate defendants far more punitively than a simple registration case should warrant.
Defendant’s Penalty Phase Brief
Hybrid Fund II, LP (“HF II, LP”) was actually established back in 2005 to serve as a vehicle for investors to invest in an absolute rate of return product. Managed Accounts Asset Management, LLC (“MAAM”) was actually the first General Partner (“GP”). HF II, LP and the GP were set up by a renowned hedge fund law firm, Sadis & Goldberg. Sadis partner, Mr. Ron Geffner, a former SEC attorney and high profile attorney in the hedge fund industry oversaw the production and formation of all the entities to be compliant of all federal, regulatory, and state laws. On December 14, 2005, Sadis & Goldberg filed a Notice of Exemption from Commodity Pool Registration with the National Futures Association (“NFA”). (Exhibit A) The NFA was formed in 1982 on the premise that industry participants would be subject to registration requirements by them. Because of Vincent McCrudden’s already personal history with NFA & CFTC officials, any vehicle that wanted to trade in the futures markets would have to be designed as an exemption from registration. Because of the corrupt denial of registration process in 2005 by the NFA and detailed in Document 176, McCrudden had filed a notice of appeal with the Second Circuit Court of Appeals which was pending at the time.
On or about February 2008, the Second Circuit denied the appeal which left no reasonable window open for McCrudden to operate a registered entity, or for McCrudden to be registered as an Associated Person (“AP”). The decision was also very punitive because it also terminated McCrudden’s NASD/FINRA Securities Licenses, 4, 7, 24, 55 & 67, which McCrudden relied on to make a living. Because of SEC rules, a registered participant denied registration by a Self Regulatory Organization (“SRO”) would automatically terminate all of his other licenses although not related at all. So, licenses studied and passed in 1998, were all lost because of unfounded allegations by the NFA & CFTC based in 1996. Furthermore, appellate court panel Judges, Reena Raggi and Robert Katzman would become additional corrupt figures in McCrudden’s future criminal cases. At the time of the oral argument, my attorney, a Washington D.C. based attorney, had been a lawyer for 25 years stated after hearing Reena Raggi bias at the oral hearing, “that has never happened to me before. Obviously Raggi was predisposed.” I would later learn Raggi was a former District Court Judge based in the Eastern District. It was my first lesson of how high up corruption was between the Courts and Government.
In 2008, powerful Government officials were well aware of whom I was and they had colluded to destroy my life and career for sport for a decade already. In 2006, I had gone to Washington D.C. to combat the efforts against me. On February 15, 2006, I attended a CFTC hearing on Self Regulatory Organizations. At the hearing, I spoke out against the NFA in a public forum (Exhibit B). During this time, I had also met with many elected officials and their staff including Senator Schumer, Congressman Steve Israel and Congressman Gary Ackerman. I had also hired a private lawyer based in Washington D.C. to investigate the targeting and pursuit of me. The elected officials and the lawyer’s investigations all confirmed the facts; I was a target by the CFTC, NFA and other Government officials that do their bidding.
On or about February 2008, my attorney at the time, Donald Pupke, established Alnbri Management, LLC (“Alnbri”) in New York. The goal of establishing Alnbri was that it was to be the new GP of HF II, LP. On March 31, 2008, Pupke was given all the documentation of the HF II, LP to change it to reflect Alnbri as the new GP (Exhibit C).
Because I had had a professional relationship with Pupke for many years and his practice was general in nature, I would reach out to him for many legal issues over the years. On April 21, 2008 is an email written to Pupke with the subject line NFA requesting his assistance in bringing a lawsuit against the NFA (Exhibit D). This email shows my state of mind at this time and awareness of the NFA’s corruption and continued pursuit of me. On the beginning stages of starting a new fund, it also should show my understanding that any structured entity would be under extraordinary scrutiny and should be fully compliant of all rules and regulations. In the same week I actually started trading the new fund, on May 19, 2008 is another email to Pupke with the same requests (Exhibit E).
On April 17, 2008, I received an email from Mr. Gregory Zoraian, a Certified Public Accountant and principal of Sasserath & Zoraian (Exhibit F). As per the email is a signed copy of the service agreement with the specific terms they would act as Administrators of the fund. The administrators are a critical component of a small hedge fund. They operate independently to give credibility to a fund and act as a liaison between the fund and the investors. The exhibit includes a letter from the previous week from Zoraian outlining the functions his firm would perform. The Court should notice two very important criteria marked #1 and #14 that Sasserath and Zoraian would perform:
v) It will maintain in full force and effect all registrations, licenses or consents of any Government entity or other authority that may be required in connection with its activities and will comply in all material respects with all applicable laws, regulations and orders to which it may be subject.
In April and May of 2008 are emails to Zoraian giving him authority to access the funds bank and trading accounts in order for him to have real time access to provide the limited partners with independent reporting (Exhibits G & H).
Also in April is an email with John Cracraft, a Sales Representative from Interactive Brokers (“IB”), concerning the opening of the trading account for the fund (Exhibit I). On May 28, 2008 is a correspondence with the New Accounts Department of Interactive Brokers (Exhibit J). It actually is in regards to the GP’s account, but it shows the type of exhaustive investigation required by Interactive to even open up a trading account. The Court should notice all the specific questions that Interactive request in regards to compliance with CTA and CPO registration and exemptions. In all likelihood, the NFA red flagged my accounts which lead to extreme vetting. In my 25 experience in opening and trading accounts, I had never been hassled like that before.
In mid May of 2008, the fund started trading. In June 2008, a new attorney was hired, Jay Malloy from Edwards Angel Palmer & Dodge (“EAPD”) from Boston. EAPD was a large firm and was referred by Greg Zoraian. Zoraian also referred an auditor, Paul Finnergan from Holtz Rubenstein (Exhibits K & L). Between Pupke, Malloy and Zoraian, and my own personal experience with other attorneys over the years, it was made known to me that as long as the fund maintained 15 clients or less and did not hold itself out as a Commodity Pool Operator (“CPO”), the fund could trade futures with an exemption. On December 19, 2008 is a correspondence with the funds attorney, Jay Malloy. In that email I ask a question of registration requirements for SEC registration (Exhibit M). Although the email is past the relevant period of the complaint and related to SEC registration requirements, not the CFTC, it shows the constant awareness of compliance and good faith efforts that will be discussed later.
In September 2008, the fund received emails from the “Surveillance” Department of Interactive Brokers (“IB”) closing the account (Exhibit N & O). In the Exhibit N email, IB explained that “certain statements about investment returns on the Alnbri website that seemingly could be misinterpreted by investors.” It also added, “the proportion of futures trading in the Hybrid Fund account appeared to be potentially inconsistent with the terms of Hybrid II’s exemption from registration.”
The fund had just passed 15 clients at the time and already had opened clearing relationships with Penson Financial Services and Merrill Lynch Prime Brokerage which it subsequently used for the balance of the funds life. So, closing the account was not fatal for the limited partners of the fund, but troublesome in many ways.
Firstly and most critically, the fund had surpassed the 15 client threshold and the fund never traded futures again with any clearing firm. Secondly, the fund and GP had accounts open with IB for less than six months and I have included just a few of the correspondences that show the CFTC and NFA were behind the targeting and harassment of the fund. IB’s reasoning for closing the account based on website “postings” were obviously false. The fund did indeed make the returns it stated on the website and that is backed by the administrators, auditors and also oppressive subpoena’s at a later date by the SEC and CFTC. The returns are even detailed in the CFTC’s complaint in December 2010. If the fund did breach the exemption limits innocently in 2008, but never traded futures again, the Court has to ask why the SEC and CFTC only started a full court press of subpoenas in August 2009.
In addition to subpoenas issued to myself, the administrators, auditors, banks, clearing firms, lawyers, etc., unprecedented subpoenas were issued to the limited partners of the fund. One subpoena, issued by the CFTC, was sent to Phil Calderone, a lifelong friend and limited partner (Exhibit P). In addition to the subpoena, Mr. Calderone was contacted directly by CFTC attorney Elizabeth Brennan asking for “any dirt on Mr. McCrudden” and then pleading with him, “don’t tell Mr. McCrudden we were asking about him.” Clearly, the CFTC were interested in more than fact finding and were hell bent on having the successful fund be closed. At the time, the HF II, LP was ranked second in the world for performance for multi strategy funds according to multiple independent databases like Bloomberg. It is well known that assets under management are the livelihood of any fund. Getting a scary subpoena and hearing scary things from Government officials has a negative effect on investors, and history has shown that redemptions come quickly thereafter. The efforts by the SEC and CFTC were successful in closing the fund in December 2009. A fund that did not have one customer complaint. A fund that made a net audited 99.6% return in 2008 when the world was embroiled in the worst financial crisis since the great depression. A fund that made a net audited 37% return in 2009. SEC attorney James Bresnicky contacted me in August 2009 and when I asked him why he was investigating the fund, he said, “because the returns were too good. to believe”
On July 8, 2010, I was deposed by CFTC attorney, Timothy Mulreaney and Joseph Rosenberg, two attorneys who put their names to the complaint along with Sophia Siddiqui. James Bresnicky from the SEC was also there, but asked no questions. They held the deposition at the US Attorney’s Office in New York. The CFTC has offices in New York, so it didn’t get lost on me or my attorney why they chose that venue.
The Boston Advisors case was both brought and settled on the same day as an Administrative case before the CFTC. The Court can read the entirety of the proceedings, but in general, Boston Advisors and its principals Thomas Brazil and Andrew Preston operated a Commodity Pool in 2002 to 2003 when the case was brought without proper registrations or exemptions.
The CFTC stated in its press release, “At the time Boston Trading and BTP were formed, Preston and Brazil sought advice of counsel regarding registration requirements, and were advised that registration was not necessary. Additionally, in October 2002, Boston Trading hired a consultant to advise them on regulatory matters, including expanding and marketing their business. The Consultant, a registrant, informed Preston and Brazil that they did not have to register as a CPO since they had less than 15 investors. Similarly, Boston Trading later consulted with a self-described “compliance specialist” who advised Preston and Brazil that they did not have to register as a CPO until they had 15 investors.”
What is critical for the Court to consider, is that Brazil and Preston weren’t even charged as Control Person’s under CEA 13(b) (7 U.S.C. 13c (b)). The “registrant” who “advised” them was not charged with anything either. As I have written before about this case, the innocent violations were not performed in bad faith. Not done in malice. Intent was not fraudulent. They did not “knowingly and willfully” violate the law and allow the violations to continue. They did not act negligently, never mind recklessly. They did not “induce” anyone to violate the law. In fact, as I wrote recently in Document 176, the Commodity Exchange Act allows for Commodity Trading Advisors (CTA’s) to manage 15 clients or less without registration, so it is a common innocent error.
The CFTC settled with Boston Advisors for $10k. They allowed it to register. In fact, the NFA registered both Boston Advisors and Andrew Preston in October 2003, the exact same month as the settlement. Thomas Brazil, who was previously registered with Citibank and JP Morgan, never registered again with the CFTC/NFA. Andrew Preston and Boston Advisors operated the fund until 2008 in which they withdrew registrations. In 2016, Preston again registered with the NFA/CFTC for Mark Anthony Trading, LLC and his stated role was, “Chief Compliance Officer.” Suspiciously, Preston withdrew his registration last month.
Let me be clear to the Court, what the NFA and CFTC did in this case was 100% correct as far as I can see. Hopefully, their investigation showed no proof of evil intent or mens rea, and they chose to not charge Preston and Brazil as controlling persons, because after thoughtful debate, they knew their actions did not constitute a violation of the controlling person statute. Preston was able to manage his fund, make a living, and the monetary slap of the wrist obviously did not inhibit him from making a living, pursuing his dreams, and even becoming a Chief Compliance Officer.
The above case consists of massive fraud over 3 years dating from 2006 to 2009. It is a typical ponzi scheme where the culprits raise capital, and use most or all the money on personal expenses and luxuries. This case involved over a 100 investors and over $14mm. The complaint was not even filed until 2012 when investors filed a complaint and had not received back their investment. When you look at cases like this, or infamous cases like Bernie Madoff, Nicholas Cosmo (09-CR-0255 Hurley’s Case) or Russell R. Wasendorf, Sr. which will be highlighted next, that occur over many years, and contrast to the targeting and harassment of my case, hopefully the Court, as a representative and proxy for the citizens of this country, will be as outraged as I have been over 20 years.
I highlight this case for a number of reasons:
The statute provides as follows:
“Any person who, directly or indirectly, controls any person who has violated any provision of this chapter may be held liable for such violation in any action brought by the Commission to the same extent as such controlled person. In such action, the Commission has the burden of proving that the controlling person did not act in good faith or knowingly induced, directly or indirectly, the act or acts constituting the violation.”
The statute was originated vaguely on securities laws, 15 USC 77 and 78(a) with the primary difference being that in the securities laws, Defendants must prove good faith, whereas the CFTC has the burden of proving lack of good faith. This is why Denis Hurley’s corrupt involvement in these cases were critical in not allowing the Defendants motions for dismissing this case early and allowing it to continue for 7 years. The CFTC never had a case against Vincent McCrudden and everyone familiar with the case knew it.
A fundamental purpose of Section 13(b) is to allow the Commission to reach behind the corporate entity to the controlling individuals of the corporation and to impose liability for violations of the Act directly on such individuals as well as on the corporation itself. (Apache Trading Corp., [1990-1992 Transfer Binder] Comm.Fut.L.Rep. (CCH) ¶ 25,251 at 38,794 (CFTC March 11, 1992). Furthermore, it held accountable senior officials for violations of subordinates if they knew about it. Subsequently, it was defined as officers who, “knowingly and willfully knew they were in violation and allowed for it to continue.” Furthermore, it is the CFTCs burden to show that the controlling person “had actual or constructive knowledge of the core activities that constitute the violation at issue and allowed them to continue.” (Spiegel, [1987-1990 Transfer Binder] Comm. Fut. L. Rep. (CCH) ¶ 24,103 at 34,767 (CFTC Jan. 12, 1988). In subsequent cases, the Courts found that the controlling person must not only act in bad faith, not only willfully and knowingly know about the core violations and allow them to continue, not only induce the violations to continue and not just act negligently, but recklessly. (G.A. Thompson, 636 F.2d at 959, citing Ernst & Ernst v. Hochfelder, 425 U.S. 185, 209 n. 28, 96 S. Ct. 1375, 1388 n. 28, 47 L. Ed. 2d 668). These are the foundation burdens of the controlling person statute that has been argued many times in various courts.
In more liberal courts, they actually included scienter as a burden on the Government which raised the burden to include that the controlling person had the intent or knowledge of wrong doing. In other courts, they used a two prong system. The law was never meant to find liability for any CEO or corporate officer simply because he held a senior position at a corporation. If that were the case, most CEO’s at major financial firms would be in prison. So, some courts first and foremost determined if the controlling person was even in a position to oversee the act or acts of the violations. This of course is discriminatory against small firms because there are no layers of protection. Still yet, the second part of the two pronged test was still a significant burden on the Government. The Government must prove, “that a controlling person possessed specific control which is the ability to control the specific transaction or activity upon which the primary violation was predicated.” (Monieson v CFTC, 996 F.2d 852, 860 (7th Cir. 1993).
Even in the most biased, most partial interpretation of the law, no court could find Vincent McCrudden liable as a control person for the simple registration violations, never mind penalize him.
All the above argument and previous pleadings by Vincent McCrudden show significant good faith to be compliant with all state, federal and regulatory rules and regulations. Nothing in 2005, 2008, 2011 or the present has changed any of those facts. On July 29,2016, my attorney Donald Pupke wrote a letter briefly explaining his role during the time of formation of Alnbri and the HFII, LP in early 2008 (Exhibit S). Pupke writes:
“It is my impression that during that time (Spring 2008), as always, Mr. McCrudden was very careful and conscientious in performing his due diligence regarding the proper registration and licensing of his funds. He always retained specialized counsel to ensure that the funds would be properly registered and organized and he acted with good faith in that regard.”
This is an unusual case. The Court is being asked to find if there should even be a penalty on no findings of guilt of any violations of the Defendants. The Court simply has a signed consent order with a ‘statement of facts” that was signed under duress and quite simply because the Defendants in this case were denied due process and was told they would never see a jury in this case. After 7 years, enough was enough.
To insure the integrity of the futures markets, the CFTC and NFA have been granted authority to make sure participants, especially when it involves customer funds, comply with all registration, trading, and accounting rules. I have written a plethora of material both to the Courts and publicly about the corrupt roles the CFTC and NFA play in the markets and rig it unfairly towards large participants.
In an independent study, it was found that for a period between 2000 and 2016, the CFTC brought on average about 100 enforcement cases a year. 83% of cases were brought against small firms in an industry where 80% of all trading volume is done by large participants. On the average of all enforcement cases against small firms during this time period, an astonishing 97% of the time the CFTC charged an officer as a control person. During the same period, the CFTC brought only 13% of cases against large firms (That criteria included small FCM’s) and in those small amount of cases, only 16% of the time did they charge an officer as a control person.
As I outlined in document 176, the original process of denying my registrations in 2005 was corrupt. The CFTC and NFA did not honor the decision by a jury, did not hold themselves accountable for giving an alternative accounting method, and deliberately went out of their way to conduct a corrupt process that had far reaching effects to not only Vincent McCrudden, but to his family, friends, investors, ex wife, children and fiancé. The destruction done for purely personal reasons will never be forgiven or forgotten and someday some officials will be held accountable.
What the CFTC did in the Boston Advisors case was the appropriate action, but that’s not what they did in my case. You would have to be blind not to see simply a continued personal agenda for sport that had zero impact on the markets. First they force the successful fund to close, and then even after it closes, they continue to investigate and hold a deposition in July 2010. Then, six months later, file this complaint directly with this Court. The same set of facts outlined in this brief is the same set of facts given the CFTC at the deposition.
The CFTC refused to negotiate a settlement in good faith and this Court was told that multiple times. CFTC lawyer Holl complained that, “upstairs was calling the shots” suggesting that someone or someone’s were making the calls and were anonymous. The CFTC obviously knows the control person statute because they do use it and they had an exact case with the same set of facts in the Boston Advisor case in 2003. But they went ahead anyway. The CFTC and Court have been given financial affidavits of Vincent McCrudden’s financial situation. Pursuant to the Commodity Exchange Act (“CEA”) 6(d), the CFTC is given discretion to weigh, “the appropriateness of such penalty to the net worth of the person charged, and the gravity of the violation.” The CFTC should have never brought this case to federal court in the first place, but according to CEA, they knew they couldn’t request a penalty for not only the Defendants inability to pay, but also to the gravity of the alleged violation. The CFTC has stated in its own words about this; “a fair consideration of the factors in Section 6(d) should ordinarily result in a civil penalty that does not exceed a respondent net worth, yet deters future violations by making it beneficial financially to comply with the requirements of the Act and Commission regulations rather than risk violations.” Premex, Inc., [1987-1990 Transfer Binder] Comm. Fut.L.Rep. (CCH) ¶ 24,165 at 34,892 to 34,893 (CFTC Feb. 17, 1988). As I stated before, the CFTC did not want to violate CEA in requesting unprecedented civil penalties and trading bans, so they are going to request this Court do their dirty work.
Furthermore, the CFTC has stated in the past about weighing penalties;
“Our gravity determination turns on the synthesis of two distinct components. The starting point is an assessment of the abstract or general seriousness of each violation at issue. The nature of some violations make them generally more serious than other violations. The general seriousness of a violation derives primarily from its relationship to the various regulatory purposes of the Commodity Exchange Act. Conduct that violates core provisions of the Act's regulatory system — such as manipulating prices or defrauding customers should be considered very serious even if there are mitigating facts and circumstances.... Once a violation has been generally located on the statutory continuum of seriousness, the focus shifts to the particular mitigating or aggravating circumstances presented by the unique facts of the individual conduct at issue....
Several factors deserve special consideration in analyzing the individual culpability of a respondent.... A respondent who makes a mistake in the face of an ambiguous statutory duty or in circumstances that are unique and unforeseeable is less culpable than a respondent who knowingly and repeatedly violates the same provisions in an effort to gain a competitive edge.”
In the Merrill Lynch copper case I presented, the violations were about the very “core violations” of fraud and manipulation the CFTC speaks about. But in that case, they don’t charge a single person as a control person. However, in this case, the CFTC requests unprecedented “nuclear penalties” for innocent “simple registration violation” allegations.
In short, the test for determining monetary penalties is to determine where in the spectrum of seriousness the violation falls and for individuals held liable as a control person, it is the amount of fine based on their net worth. For Vincent McCrudden there is no fine because there are no violations as a control person, period. And even if he were liable, the Courts and CFTC’s possession of financial affidavits showing a negative net worth would negate any monetary fine. For MAAM, it had nothing to do with the relevant period. For Alnbri, even if the Court found liability for breach of violating the trading limits of an exemption, a comparable fine would be like the one in the Boston Advisor case of $10k, However, the Court cannot go back in time and give Alnbri their hedge fund back and the ability to pay the fine as it was forced to close. Alnbri also no longer exists. Unlike Boston Advisors, Alnbri cannot be registered within the same month as the fine. In short, even if Alnbri was deemed liable, there is no benefit to society in assessing one and it might open the door for continued CFTC harassment of Vincent McCrudden for them to try and pierce the veil of a corporate entity to hold McCrudden personally liable. No one should want this.
The facts presented in this pleading should show that no penalty should be given. The only question is which Kathleen Tomlinson is going to show up. Will it be the company employee who signs a warrant to a home not lived in four years? Or who states what a fine will be without any facts? Or the person who wrote a 50 plus page thoughtful decision detailing the entirety of the case at that point in considering a default motion? Or like Holl, will she be pressured from “above”? The CFTC will ask for unprecedented fines and trading bans. They will not just request trading bans for Vincent McCrudden and/or any future entities controlled by him, but they want lifetime personal trading bans. Respectfully, this Court lawfully could not grant that.
If this Court would like to send a message, if any, that would evoke change and create an environment to make the futures markets more competitive and fair for small firms, they should fine the CFTC and all the officials who brought this case. Fine the CFTC $58mm dollars for bringing this frivolous case in the first place and wasting this Courts time and tax payer money. As is my experience, the Court has broad discretion in interpretation of the law. It can be very “narrow” in its focus to simply find someone liable when it comes to “letter” of the law, or then very “broad” like Hurley had done to me in the criminal case by using history and characteristics of the defendant to justify a predisposition bias. If this Court wants to be predisposed, then be predisposed by the criminal nature in which entities like the CFTC, Finra and NFA operate. Do not allow officials to come from Washington or Chicago to Long Island and determine which people they would like for you to screw. To affect innocent local investors in a successful vehicle. To waste and affect the time, money and resources of administrators, auditors, lawyers, clearing firms and banks that have better things to do all for simply pursuing personal agendas. This court now has a platform and opportunity to positively evoke real change in the financial markets, use it.
Vincent McCrudden in behalf of Defendants
Judge Kathleen Tomlinson
United States District Court
Eastern District of New York
100 Federal Plaza
Central Islip, NY 11722 January 25, 2017
Case No.: 10-CV-5567
I would like the court to consider my response to the CFTC’s letter to the Court dated January 23, 2017 (Document 175) regarding corporate defendants MAAM and Alnbri.
According to the CFTC website, they tout their mission statement as, “To foster open, transparent, competitive, and financially sound markets. By working to avoid systemic risk, the Commission aims to protect market users and their funds, consumers, and the public from fraud, manipulation, and abusive practices related to derivatives and other products that are subject to the Commodity Exchange Act (CEA). The futures and swaps markets are essential to our economy and the way that businesses and investors manage risk. Farmers, ranchers, producers, commercial companies, municipalities, pension funds, and other users use these markets to lock in a price or rate. The CFTC works to ensure these hedgers and other market participants can use markets with confidence.”
The CFTC also boasts about overseeing a massive $400 Trillion swaps market and that Congress authorized it to oversee more of it after the financial crisis of 2008. The CFTC never once mentions registration because that was the role of the National Futures Association when it was established in 1982. It was established by Dan Roth and Dan Driscoll who both worked at the CFTC since conception and came up with their own fiefdom. As mentioned previously, never in the history of the CFTC have they brought directly to Federal Court a simple registration violation. Never in their history did they bring charges against institutions that had already closed shop.
Judge George Painter was an Administrative Judge with the CFTC for 35 years. In 1995 Judge Painter wrote about the CFTC’s enforcement agency after it had reversed a complaint by an elderly couple about commission abuses by a large clearing firm where 95% of the couple’s assets were stolen. He wrote; “this action is a green light to those in the industry with a proclivity for taking advantage of the elderly and unsophisticated.”
Before retiring in 2010, Judge Painter wrote a legal brief with his resignation so that it would be of public record. He stated that his other Administrative Judge, Bruce Levine, “ruled against plaintiffs (investors) for over 20 years as a vow to then CFTC Chairwoman Wendy Gramm” to whom he witnessed firsthand. “A review of his rulings will confirm that he has fulfilled his vow.” Judge Painter did not want any of his pending cases to be decided by Judge Levine. He further wrote, “Judge Levine, in the cynical guise of enforcing the rules, forces Pro Se complainants to run a hostile procedural gauntlet until they lose hope, and either withdraw their complaint or settle for a pittance, regardless of the merits of the case.”
Judge Painter’s words more than contradict the truth about the CFTC’s “mission statement.” It was not news to me at the time. A lawyer who worked at the CFTC for 25 years told me explicitly back in 2005, “the CFTC was the most corrupt agency in Washington.” The CFTC is the dictionary meaning of “regulatory capture” in which they and the NFA have been established for the very purpose of exploiting “farmers, ranchers, pension funds, elderly, disabled” to benefit large firms they do their bidding for, and run a revolving door of public/private service.
In 1997, I ran a small Commodity Pool. That pool was the victim of manipulation and fraud of the copper markets that had been ongoing for many years. The violators were all very large firms, JP Morgan, Sumitomo Bank, Credit Lyonnais, Merrill Lynch, etc. The CFTC were well aware of the ongoing manipulation but wasn’t going to do anything about it until some fed up traders filed a federal class action lawsuit. Only then did the CFTC act. I was a lead plaintiff in one of the classes. I worked with Scotland Yard and the attorneys to help understand how all these big firms manipulated the markets, filed false inventory reports, and used the newspapers to publish false reports about Chinese hoarding. The CFTC fined Merrill Lynch $125mm. In all probability it was a slap in the wrist as they made much more than that over all those years. The key part is that not a single person was charged as a control person. In fact, Merrill Lynch never ever missed a day trading futures, and incredibly copper futures and swaps. But astonishingly according to Jim Holl’s letter he not only wants money, he wants trading and registration bans for simple registration violation allegations.
When the time came to try and account for the copper losses for my funds investors and how they should account for the inevitable settlement award, as the registered representative, I reached out to the CFTC and NFA on how I should account for it. They both gave me a non GAAP accounting standard called Notional Accounting. They said I could use it until such time that I was responsible for filing a GAAP yearend audit to the NFA, which I complied with. The NFA at the time stated, “the funds audit was unremarkable.” Meaning, they had no issues with it. However, for some personal vendetta, both the CFTC and NFA helped the DOJ and Loretta Lynch try and prosecute me for “mail fraud” in 2000; three years after the fund had already closed. What was at stake were 7 accredited investors and their investment of $800k in total. In 2002, the settlement award came in and the investors received back $900k, $100k more than they lost in the copper fraud. For me, Dan Driscoll of the NFA came to my trial everyday and worked with the DOJ in trying to send me to prison for 6 years. In October 2003, after a 2.5 week trial and my testifying on my own behalf, I was acquitted of all charges. Just the allegations alone changed not only my life, but my family’s life forever. But I persevered and tried to recoup my career and life.
I had no way of knowing how corrupt Dan Driscoll, Dan Roth and the CFTC were at the time. When I went to get back my commodity license that I had since 1985, Dan Driscoll denied the registration and then handpicked the former Chairman of the NFA, Charles Nastro, to make sure I would be denied due process and to further defame and libel me in their unlawful proceedings. Unfortunately for me, I already possessed NASD Securities Licenses 4, 7, 24, 55 & 63. I required those licenses to make a living which I was trying to do. Unknown to me was that there was an SEC rule that stated that if a registered representative is denied registration by a Self Regulatory Organization (SRO), which is what the NFA was, I would lose all my other licenses that I had worked so hard to get. There was a lot at stake and with a mandatory appeal at the CFTC who colludes with the NFA all the time, my career was at risk with young children at home and already tremendous years of anxiety for me and my wife.
I write this to remind the Court that this is not the first time the CFTC and NFA had targeted me. They had made it their life mission to make sure they destroyed my life. As that time, there were no allegations of theft or fraud for monetary gain. My investors, as they have been both times I ran a fund, were highly sophisticated investors, accredited investors, many of whom were in the financial markets themselves, or had law firms and accountants who did due diligence. This case, as the Courts know, also has no allegations of fraud or any other wrongdoing that the CFTC would have fabricated if they could have had it not been that the fund was well represented by industry professionals. The Court also is aware that the investors made a 138% net audited return during this time. This return, remarkable in any market conditions, is all the more remarkable in light of the fact that the market suffered the worse meltdown since the great depression and large banks needed to be bailed out by taxpayers. The CFTC boasts about the fact Congress granted it more authority, and they have breached that authority by pursuing me once again for personal agendas.
In 2014, Jim Holl and I spoke about a settlement. He said to “trust him” and that he wanted this case off his desk. He requested that I fill out an exhaustive financial disclosure and upon review of what I had verbally had told him, he would do his best to settle the case so we can all move on with our lives. I gave all my pertinent information detailing my hundreds of thousands in debt. As a policy, the CFT C has to consider a defendants ability to pay in determining a settlement agreement. As per the course for a scumbag former DOJ lawyer, he never responded to the affidavit and just used me to acquire more personal information about me.
I have sought legal relief against the CFTC, NFA and Finra’s unlawful pursuit of me. I filed a federal TORT claim which took years to do. Unknown to me as a Pro Se is the federal Courts pretend due process of their buddies who all get their paychecks from the same place. After 2 years, my case was dismissed for “failure to state a claim to which relief can be granted.” In fact, 3 other federal lawsuits were all decided in the same fashion and all within two years. But this case, seemingly so complicated, just entered its seventh year. There is really no normal human being who could afford a court case for 7 years.
In determining those TORT claims though is a test to the Government official under Bivens that the official “act in good faith” and because they have such broad discretion, “exercise due care” in their “pursuit of a law or a statute.” Without a doubt and there should be no question, Jim Holl, Gary Gensler, Tim Mulreaney and other cowards at the CFTC who work anonymously behind the scenes not only did not exercise due care, but have violated and abused their authority given to them by the public. When CFTC lawyer Elizabeth Brennan, not armed with any customer complaints, issues subpoenas to not only industry professionals for information, but also directly to limited partners of the fund, and then contacts them asking for “any dirt on Mr. McCrudden”, it is not only not exercising due care, it is abusing authority at the highest levels of Government.
Both Court and Government agencies have the same degree of moral ethic responsibility in that because they are given such massive authority, they should exercise due care. The actual CFTC mission statement is actually a worthy cause in protecting the public. Certainly both the CFTC and NFA from time to time do catch predators that prey on the misinformed, elderly and innocent well intended investor. But there overwhelming legacy over their history has been supporting bad behavior at large institutions under regulatory capture.
The Eastern District of New York has been a critical partner of not only the CFTC and NFA over the last 20 years in their pursuit of me, but also Loretta Lynch personally and the DOJ. That’s why I specifically wrote back in 2011 that you and Denis Hurley remove yourself from one of the cases in order to allow me due process. This case should never have been brought to federal court in the first place, never mind taken 7 years. I have documented Denis Hurley’s unlawful conduct the best I can both to you, the Second Circuit and to Justices Roberts and Ginsburg. Just like Judge Painter’s disclosures as an insider, my valid complaints have been more than validated by this courts action in support of the CFTC and DOJ.
This Court also has an obligation to the citizens of this country in utilizing court time and frivolous lawsuits. This Courts decisions can also have an effect in how the CFTC operates in the future. In my last letter to the Court, I requested that in order for justice, if the corporate defendants go back to square one after 7 years even after a consent order was signed with representation, then if the Court is now going to operate under letter of the law, which it hasn’t done before in any of my cases, then any lawyer will do and should be assigned for that purpose. As I stated in the letter, “who gives a shit” meant that the markets don’t care about this case now, but if this court allows a technical default, that decision will be unwise and I will have no choice then to pursue an appeal. For me, it is most certainly about getting separation from not only the CFTC but the Courts. The CFTC has already been involved in my life and career for 20 years. I have been tried and acquitted once back in 2003. That wasn’t good enough for them, so they kept on targeting and pursuing me which resulted in not only this civil case, but the criminal cases. Hopefully now the Court can see that my language was protected speech. I mean if Madonna can openly state in public viewed by millions of American’s that she dreams of “blowing up the White House” without prosecution for true threats, but I can be imprisoned for simply helping a young man with legal work and be sentenced to 10 months in prison under the guise of punishing me for acquitted conduct of true threats, it is just another account of malicious prosecution. As for that email sent from Singapore, certainly anyone can see that Dan Driscoll and others were motivated to keep trying to pursue me even as I had closed my fund and moved 10 thousand miles away. No one believes I wrote it. And that Facebook posting “found” by Dan Driscoll a week after my trial was supposed to begin is laughable. He is the only person in the group?
Regardless of that prosecution, I have been given a life’s sentence that I find almost impossible to navigate now. Jim Holl is in possession of a financial affidavit that proves that I have no ability to pay a fine, and during settlement negotiations did not include a monetary fine, but for precedent and looks purposes, he now wants the Court to do his dirty work and assign a monetary penalty. I have already provided the Court with a similar CFTC administrative case of CFTC v Boston Advisors (2003), and their two principals Thomas Brazil and Andrew Preston. During the penalty phase I will not only speak more about that comparable case, but many others that will show unprecedented action by the CFTC. Quite simply, it would be impossible for any Court to now come up with any penalty after 7 years after so much damage and penalty has already been paid beyond anything comparable. That is why the integrity of this Court is so important. Denis Hurley cannot have it both ways. He cannot imprison me unlawfully for protected speech to the Courts, and when I am requesting separation, now grant the CFTC a default so they can continue to pursue me further.
In the name of justice and fairness, I request the Court to not grant a default judgment. It would set a terrible precedent against small business owners. A default will only set off another round of litigations to which no one wants. We are one step away from getting this over and done with. Jim Holl, Gary Gensler, Tim Mulreaney and others have not operated in good faith and continue to provoke me at their own peril now. I have used the Courts to seek justice, accountability and fairness with no joy and I will not tolerate these men to continue to take any more time from my life. It is the Courts decision. If you want Vincent McCrudden to not correspond or interact with anyone in Government, then leave me alone to pursue whatever I have left in life.
Vincent McCrudden – Pro Se
In the wreckage of the 2008 financial crisis many Americans looked for someone to blame. The official explanations came in waves.
First there was the “these things just happen” story. It was essentially what Wall Street and Corporate America wanted people to believe, which the mainstream media (owned by them) happily repeated with an awe shucks demeanor. You could practically see the journalists looking into the sky, arms outstretched, cursing the heavens for man’s precarious existence.
The narrative is best epitomized by JP Morgan CEO Jamie Dimon telling Congress in 2010 during a hearing on the financial crisis “Not to be funny about it, but my daughter asked me when she came home from school ‘what’s the financial crisis,’ and I said,’Well it’s something that happens every five to seven years.'”
But that explanation was unsatisfactory to a number of constituencies, including the elite who knew the political system could not survive another bailout given the lack of trust between the haves and increasingly numerous have-nots.
So next came the more familiar attempt to let partisan blame-gaming take hold. Democrats would mostly blame deregulation and Republicans would mostly blame poor people, especially poor black people. Nothing criminal mind you, just one interest group gaining too much power over the other.
The “business as usual” story also failed to satisfy most Americans. Though deregulation surely played a role and perhaps poor minorities lied on loan applications, neither could comprehensively explain the 08′ crisis or do anything to prevent the next one.
The last wave finally hit home. The explanation that stuck was that the Wall Street banks had committed massive fraud both in the securitization of mortgage-backed securities (MBS) and the sale of those securities to other financial institutions. When the fraud got too big to manage the entire system came crashing down, taking the real economy with it and causing the so-called Great Recession.
A few years after his “these things just happen” testimony before Congress, Dimon and his fellow Too Big To Fail bank CEOs were in discussions with regulators that would ultimately lead to some of the biggest fines in US history for financial fraud.
Despite the record settlements and fines, none of the Wall Street executives responsible for bringing the global economy to its knees would face criminal prosecution. Zero. Nadda.
But during this same period and well before, one man from the financial services industry would actually face the full power and force of the US government for his activities, his name was Vincent McCrudden.
A Very Small Fish
McCrudden was never, by any measure, a serious risk to the financial system. Even at the height of his earnings, he was not remotely a rival to the titans of Wall Street. Nonetheless, the US government has spent over a decade investigating and prosecuting him with breathtaking zeal.
The same prosecutors and regulators, including current Attorney General Loretta Lynch, have gone all-in on locking up this nominal player in the financial markets with no discernible victims: none of his investors took significant losses nor has any public or private institution been damaged by his activities.
Vince McCrudden started his Wall Street career in 1985 at the New York Commodity Exchange as a runner before working his way up to a licensed broker focusing on gold, silver, an foreign exchange (FX) options. After some success moving around different firms while primarily staying in the FX options markets, McCruden starts his own hedge fund, Commodity Pool, in 1995.
The fund officially launched in February 1996 with only $233,000 after other investors backed out. In May 1996, McCrudden began having serious problems and by June, McCrudden’s fund was down $330,000 from poor trading in copper futures. McCrudden insists the loses were damaging but “not fatal.”
After seeing an article about it that August, and looking to recoup some of his losses, McCrudden joined a class action lawsuit against Merrill Lynch, JP Morgan and other banks which are alleged to have been running a years-long scheme to manipulate the copper market.
JPMorgan was under considerable scrutiny for its business practices in the copper market at that time. In 1997, the Federal Bank of New York reprimanded JPMorgan for the firm’s “lax controls and supervision in its commodities lending business,” which is noted in a New York Times story about JPMorgan’s pioneering use of derivatives to help a commodities trader, Yasuo Hamanaka, take huge risks in the copper market.
JPMorgan loaned Hamanaka $535 million, which the trader used to try and manipulate the copper market. The loans were structured as derivatives according to a lawsuit filed by Hamanka’s employer, Japanese-based Sumitomo Corporation bank. Sumitomo ended up taking $2.6 billion worth of loses thanks to Hamanka’s bad trades.
While hoping for a settlement, which he believed would be in the millions, McCrudden continued to trade for the fund and continued to take loses. McCrudden closed the fund in 1997 and used a methodology called notional accounting, to present the books in anticipation of receiving funds from a legal settlement.
McCrudden claims it was his regulators, the National Futures Association (NFA) and Commodity Futures Trading Commission (CFTC), that told him to use notional accounting in lieu of the standard method known as General Accepted Accounting Principles (GAAP). Part of the agreement was to submit a GAAP-based yearend audit, which McCrudden said he complied with.
A Tragic Pissing Match
Despite McCrudden’s assuarances, one of the partners hired a former assistant US attorney named Andrew Tomback who worked for the law firm Milbank, Tweed, Hadley & McCloy LLP to ensure he was paid back. McCrudden claims he gave Tomback all relevant information needed to prove that nothing improper was going on.
According to McCrudden, Tomback aggressively harassed McCrudden to pay the investors back, an effort that included sending threatening letters. McCrudden says he told Tomack to “fuck off” and the back and forth went on from 1997 to 2000.
McCrudden also takes issue with Tomback’s supposed conflict of interest as Milbank was also representing JPMorgan in the class action lawsuit McCrudden was a part of. There’s no evidence that played a role in their dispute.
What there is some at least circumstantial evidence for, is that McCrudden royally pissed off Tomback and that Tomback used his government connections to get back at McCrudden.
Arrest And Trial
In May 2000, Vincent McCrudden was arrested by the FBI and charged with mail fraud for his accounting practices (and subsequently transmitting them through the mail).
McCrudden claims Tomback told McCrudden’s lawyer that “I had your boy arrested.” This can not be verified.
The prosecution of the case is done under future US Attorney General Loretta Lynch, then United States Attorney for the Eastern District of New York.
In June 2000, the case against McCrudden is dismissed without prejudice, giving prosecutors an opening to bring the case at a later time.
In May 2002, prosecutors do just that and McCrudden is arrested again on the same charges under new US Attorney Roslynn Mauskopf.
Also in May of that year, McCrudden receives the funds from the settlement from the class action case and says he made all his investors and partners whole.
Nonetheless, McCrudden’s case goes to trial in September 2003, where after two and half weeks of testimony and evidence he is acquitted of all charges by a jury-a total defeat for the government, which has been notoriously shy about bringing the criminals responsible for the 2008 to trial at all.
Though McCrudden prevailed in court, he clearly upset some powerful people within the futures trading industry. Whether this was due to a disparagement campaign by Tomback behind the scenes, embarrassment related to going to trial for mail fraud, or McCrudden’s brusque personality is unknown.
For whatever reason, the NFA appears to be looking for ways to not give McCrudden his trading license back in 2004. The NASD Series 3 license had lapsed and had to be re-issued by the NFA.
McCrudden also does something truly ill-advised (I say with irony) in 2004: he starts a blog. McCrudden begins slamming regulatory officials as corrupt and then disseminating the information to people throughout the industry.
In 2005, the NFA denies McCrudden his license citing a vague catchall statute in the Commodity Exchange Act (CEA). The NFA does not cite any particular transgression.
McCrudden appeals the decision and loses. Unknown to him at the time, losing his NASD Series 3 license means he is ineligible for other licenses he requires to work in the industry.
In 2008, the Financial Industry Regulatory Authority (FINRA) comes after McCrudden for “failure to uphold high standards,” which will ultimately result in fines and suspension for McCrudden in 2010.
Yes, the NFA, CFC, SEC, US Attorney Office of East New York, and FINRA have all been part of investigations and prosecution and sanction efforts on a D-list commodities trader who has never actually lost anyone any serious money.
Your tax dollars at work.
During the same period of time that the government was relentlessly going after Vincent McCrudden, major and systemically important criminal activity was going on on Wall Street. Activity federal regulators have been warned about at the time such as the Bernie Madoff Ponzi scheme and rampant fraud in the mortgage security market.
Federal regulators not only took no action to stop these crimes, they refused to even investigate them. And, after the damage was done and the economy on its knees, refused to prosecute or seriously sanction the wrongdoers.
McCrudden is now well-crushed. His “threats” landed him in prison multiple times and he is essentially finished in the securities and futures industry.
Those whose criminality damaged the futures of a generation of Americans have moved on unpunished and well-rewarded. Goldman Sachs alumni are set to staff the new White House just like they staffed the old one.
The philosopher Anarcharsis once remarked of Ancient Greece, “These decrees of yours are no different from spiders’ webs. They’ll restrain anyone weak and insignificant who gets caught in them, but they’ll be torn to shreds by people with power and wealth.”
Same as it ever was.
Dan WrightDaniel Wright is a longtime blogger and currently writes for Shadowproof. He lives in New Jersey, by choice.
Judge Kathleen Tomlinson
United States District Court
Eastern District of New York
100 Federal Plaza
Central Islip, NY 11722 December 9, 2016
Case No.: 10-CV-5567
I am receipt of your letter dated December 8, 2016. Firstly, I have fought for 6 years to get this case to a jury trial so the world can see for themselves how corrupt the Courts and CFTC are and work together. I was advised by multiple counsels that I would never see the light of day of a jury trial for numerous reasons, mainly the bias, prejudice and immoral actions of Denis Hurley. I wrote to you in November and there is no way this man can stay on in this case. Its one thing to deny due process and work with all Government agencies to destroy my life and career, and quite another to be incompetent. I only signed the consent order on advice of counsel because they stated that the Court would decide the penalty and at this stage, who gives a shit anymore. Society doesn’t care, the markets don’t care and this case should have never made it to Court in the first place and should have been summarily dismissed early on with my motions.
Hurley writes in his letter that Alnbri and MAAM now have 60 days to obtain counsel. Why would I have fought for 6 years to stave off default for this bullshit case, only after a consent order was signed with counsel, then to allow them to withdraw and go back to square one? I mean the CFTC didn’t even inquire about counsel, Hurley is doing this solely on his own and not only acting as he has done, as counsel for the CFTC, but making decisions where he isn’t even being petitioned. And now there are “discovery” issues? I had no idea about them and Hurley shouldn’t have agreed to allow counsel to withdraw if there were further litigation processes.
Listen; never in the history of the CFTC in 40 years have they brought a simple registration violation to federal court. Earlier this year, I found one single case identical to mine. In 2003, the CFTC brought an ADMINISTRATIVE case against Boston Advisors and its two principals, Andrew Preston and Thomas Brazil. As they always do with big firms, they submitted and settled the case on the same day. Boston Advisors were told by ‘registered participants” that as long as their fund stayed under 15 clients or less, they were exempted and did not have to register. This is an honest mistake even by lawyers and/or registered experts because the Commodity Exchange Act allows this for CTA’s, but not CPO’s. The law itself is confusing because there is no real difference in pooling 15 clients’ funds, or trading them in their own accounts. Economically it’s the same unless the CFTC is helping FCM’s churn accounts which is probably the real reason.
Now comes the real good part. The CFTC fines the entities and principals a total of $10k, and then they and the NFA work together to allow them to register within three fucking months. They then operate the fund until 2008 while I was making my investors a 99.67% net audited return, they were blowing up and closed the fund. Oh and one of its principals now, Andrew Preston is a fucking Chief Compliance Officer at an FCM.
Now, contrast that to this case. I too was told that the fund didn’t need to be registered with 15 clients or less. But the CFTC came in heavy handed. CFTC lawyer Elizabeth Brennan contacted clients asking for “any dirt on Mr. MCrudden.” Unlike the Boston Advisor case, they charged me as a control person while Preston wasn’t charged and now he is a Chief Compliance Officer. They forced me to close my successful fund and way to make a living. Although the fund was closed, they deposed me eight months later. And then, 5 months later, without any “settlement talks” went straight to federal court with this bullshit. Former scumbag DOJ lawyer Jim Holl is constantly crying that “upstairs and enforcement are calling the shots” and that’s why he can’t settle. I wanted a jury trial anyway, but can’t get there. I have no money, so there aren’t any settlement talks about that. The CFTC and NFA already have a “soft ban” on me threatening FCM’s that do business with me. So, what it is they actually want? It isn’t enough that I went to federal prison three fucking times because of this case? I have lost everything and they want more than everything? My fiancé is going bankrupt now trying to help me and that STILL isn’t good enough. Denis Hurley has acted unlawfully and was handpicked by the Government almost 7 years ago now, and now he wants to act by the letter of the law?
So, here’s what needs to happen. The CFTC can take out that language in the consent order and we still can use that to go to the penalty phase. Hurley agrees to the consent order and now wants to help the CFTC have discovery grounds without counsel for me or the corporate entities? Bullshit. Judge Tomlinson will decide the penalty phase, but only if Hurley has no say. If that can’t happen, then this case has to be sent to a different court in a different district. If the CFTC insists on that language and some sort of bullshit discovery, then this Court will provide counsel for the corporate defendants as it should have done years ago but Hurley prematurely squashed it.
My counsel should have never allowed this discovery clause. I was told there was nothing left to do and all was left was the penalty phase. I only agreed because there should be no penalty, and if there is any penalty, the lawyers at the CFTC including Gary Genlser and Tim Massad and others should be liable for bringing the case in the first place and both the CFTC and Hurley for wasting tax payer money. So, I was given ineffective assistance of counsel for this even to be brought up now.
You cannot have a defendant work so hard for justice and disclosure over almost 7 years now and nine years from the allegations, allow counsel to withdraw, and then without a petition, place the corporate entities back to square one for his own personal agenda yet again. Counsel anyway, obviously doesn’t know what it’s doing. It’s funny, I relied and paid for counsel in the first place about exemption, and now counsel is paid again and I am left holding the bag yet again. Is there any part of the system which doesn’t end up with me getting fucked? And Hurley wonders why I am so angry? It’s one thing to destroy my life and career for sport. That’s unforgivable and cowardice. But quite another to destroy my children’s, fiancé and ex wife’s lives. That needs to be held accountable.
So, you have my answer. The corporate entities had counsel when the consent order was signed as well as me. I was never told that counsel withdrawing would have any adverse affects other than the penalty phase was to be determined and there was no need for counsel to be paid any more money and I could do that without any obstacles from the court. Hurley placing this whole 7 year bullshit case that have cost taxpayers hundreds of thousands of dollars for no reason back to square one and allowing counsel to withdraw when he himself agreed to the consent order shows clear incompetence on his part at the least, and continuation of harassing and targeting the defendant as he has done for 7 years now and has acted unlawfully.
Thank you for your time and consideration in the matter.
United States Court of Appeals
For the Second Circuit
United States of America
On appeal from the United States District Court For The Eastern District of New York, No. 11-CR-0061
PETITION FOR PANEL REHEARING OR REHEARING EN BANC OF APPELLANT VINCENT McCRUDDEN
Vincent McCrudden – Pro Se
19-19 24th Avenue, Apt. L313
Astoria, New York 11102
RULE 35(B) STATEMENT
This case arises from alleged multiple Violations of Supervised Release Reports (VOSR) from the US Probation Department and prosecuted by the US Department of Justice. A corrupt Senior District Court Judge, Denis Hurley, failed to recuse himself after more than seven formal requests over 4.5 years in two separate cases and each time denying the motion by stating that he could be “fair and impartial.” First and foremost, Hurley violated the Appellant’s Constitutional rights to a fair and due process by violating the Appellants First and Sixth Amendments. He colluded with Chief Judge Robert Katzman and USAG Loretta Lynch to justify personal agendas. He allowed a “trojan horse” of what the Government constantly referred to as a “technical rules violation” to violate moral laws of double jeopardy to justify a severe prison sentence. Secondly, this panel deliberately misinterpreted “acquitted conduct by a preponderance of evidence” to protect both Katzman and Hurley and acted unlawfully. The District Court and panel deliberately skewed and weighed 3553 (a) sentencing factors of “history and characteristics of the defendant” unlawfully to justify an unprecedented prison sentence.
Furthermore, Chief Judge Robert Katzman acted unlawfully by denying Judicial Complaints against Hurley without doing any investigation. Additionally, the Clerk’s office and Catherine O’Hagan Wolfe violated due process rights by not forwarding a Judicial Complaint appeal, admitting mistakes, and then Katzman covered up his corruption by directing his employee, Ms. Karen Milton to collude with Ms. Wolfe and send a letter stating they would deny the appellants rights to a legitimate judicial complaint.
Hurley’s and Katzman’s collusion, and biased and unlawful conduct must be investigated and the panel’s unlawful and biased decision must be vacated.
Rehearing is warranted because the panel opinion directly contradicts with decisions of the Supreme Court, decisions by this Court, and decisions by many other district courts. Furthermore, this case represents extreme importance in a number of instances. First, the decision conflicts with decisions and interpretations of this very court and also the Supreme Court. Secondly, this Court has acted unlawfully by establishing a terrible precedent of upholding a procedure to hold a defendant guilty through a trojan horse of a technical rules violation that was adjudicated and found innocent by a preponderance of evidence. Lastly, this Court has performed a series of unlawful actions against the appellant by denying due process and orchestrated by the Chief Judge in collusion with the Senior District Court Judge and others.
On December 1, 2010, Appellant Vincent McCrudden was unlawfully charged with a “simple registration violation” by a corrupt Government Agency, the CFTC. That case was “assigned” to EDNY Judges Denis Hurley and Kathleen Tomlinson. Appellant lawfully responded to this bogus charge on the internet while he was living in Singapore. On January 14, 2011, McCrudden was arrested by 40 armed Federal Agents after deboarding a flight from Singapore. The arrest warrant was signed by Tomlinson and the case again was “assigned” to Tomlinson and Hurley. The appellant was charged with true threats violations of Title 18 USC Section 875 (c), was arraigned and denied bail by Hurley although never alleged nor found guilty of a violent crime in his life. The appellant motioned Hurley to recuse himself from one of the cases so he could have a fair due process. The motion was denied and Hurley subsequently denied six more formal recusal requests thereafter. After multiple denials of motions by the appellant’s attorney by Hurley, the appellant’s attorney told McCrudden, “He would not get a fair trial as long as Hurley was the Judge.” This attorney had been practicing law for over 30 years. The appellant again motioned Hurley to recuse himself and was denied. The appellant, although innocent of the underlying charges and having picked a jury, took the advice of counsel to accept a plea deal at the last minute as due process was being denied by Hurley at every turn. That plea deal comprised of 21-27 months of incarceration and one year of Supervised Release. On April 6, 2012, the appellant was sentenced by Hurley to 28 months of incarceration followed by two years of Supervised Release.
The appellant served his time incarcerated without incident and was a model prisoner although an innocent man and released on January 23, 2013. Although the Government only requested one year of SR, Hurley’s decision of two years would turn out to be self serving.
In August 2014 at the US Probation Departments offices, the appellant was verbally threatened by US Marshal Ralph Rosado at the request of Hurley and USAG Loretta Lynch. Rosado wanted the appellant to abrogate his First Amendment rights and take down a website and stop litigation against federal officials including Lynch. He told the appellant in front of witnesses, “The whole US Attorney’s Office knows you by name. They (Lynch) are looking to charge you with some form of federal jaywalking if you don’t stop.” When challenged that all pleadings and conduct were constitutionally protected speech, Rosado responded that he “did not care.”
On November 11, 2014, the appellant wrote 200 emails to the media and Senate members as to why Loretta Lynch should not be confirmed as USAG. On November 14, 2014, that very next Monday at 6am, the appellant’s door was busted down and he was arrested by 25 armed federal agents frightening his deaf sister and fiancé. An unlawful search and seizure was executed and all of the appellant’s electronic devices and computers were seized by the FBI. They would subsequently unlawfully search the entire contents of devices, including privileged information. The appellant was charged as a violation with true threats and the Government produced 9 pleadings to various courts over the course of the two previous years including a letter to the Second Circuit and a small handwritten note with one sentence pertaining to the appellant’s judicial complaint against Hurley, “How much more do I have to tolerate. When will you do something?” The Government tried to take a word and sentence here and there over multiple pleadings to try and convey a false conclusion. Included in their exhibits were six letters written directly to Hurley in his role in the civil case which had been ongoing for years.
At arraignment and acting Pro Se, the appellant immediately called for Hurley’s recusal because Hurley indicated he wanted to be a material witness. He stated, “I remember receiving correspondences, but I did not deem them as threatening. They were not imminent threats against me.” Despite his testimony, he denied bail to the appellant.
With the appellants completion of SR due to terminate on January 23, 2015, the Government held in abeyance an additional charge of “association with known felons”. They were able to bring the charges as fruit of their unlawful search and seizure of the appellant’s computer where they found 7 innocent and innocuous letters written to inmates still in prison. The Government constantly referred to the violation as a “technical rules violation.”
Multiple hearings were held in the case and the appellant testified on his own behalf. Recusals were issued again and denied again by Hurley who contended he could be “fair and impartial” although technically already testifying and a recipient of 60% of the Governments exhibits.
On March 15, 2015, the Court found all the Governments allegations unfounded and all the pleadings and single website posting as protected First Amendment speech. Since the process was a Supervised Release violation, the Court only to have found the writings by a preponderance of evidence standard. So, the appellant was so innocent that he was found not culpable by the lowest burden of the Government and by a corrupt Judge who was a material witness and recipient of a majority of the Governments case. However, the appellant had just served 4 months in a maximum security administrative prison unlawfully and the Court and Government had to now justify bringing the case in the first place.
The Government not satisfied with an unlawful process, decided to double down and proceed with a violation charge of the innocent and innocuous correspondences. In July 2015, Hurley found that one single letter and one phone call to an inmate serving time in Berlin, New Hampshire was a violation of Supervised Release. That correspondence was a result of the inmate’s wife reaching out to the appellant to seek his help in filing a motion on the inmate’s behalf to benefit from a new law, Amendment 782. The appellant was successful in having the inmates 12 year drug sentence reduced by 2.5 years. Hurley scheduled sentencing for August 17, 2015. The appellant submitted a sentencing memorandum explaining that a “technical rules violation” was prohibited from being punished by incarceration and that 4 months were already served and an additional 5 months of SR. The Government did not even submit a sentencing memorandum.
At sentencing, the Government orally argued exclusively on the original plea and the acquitted conduct, the letters. What was shocking though is that Hurley stated that he deemed the appellant a “dangerous individual” and incredibly disclosed that, “for the first time in my life I installed a burglar alarm.” Since there were no new developments or correspondences from Hurley’s statements in November, this deliberate justification of a harsh sentence raised questions in a number of ways. Hurley had now lied on the record. Either the burglar alarm was a lie, or his decision that he could be fair and impartial was a lie. And if the burglar alarm is true, then why wasn’t that investigated and found during the appellants judicial complaint and investigation by Chief Judge Robert Katzman? There is no evidence anywhere that the appellant is a dangerous individual, and those statements by Hurley was a deliberate lie to distort the record and to justify an unlawful, predisposed sentence.
Reasons For Granting Rehearing
It is suffice to say that the actual Violation of Supervised Release (VOSR) of at distance association the appellant defended was not a factor in the sentencing and acted only as the trojan horse the Government had hoped for to get a second shot at punishing the Appellant for protected speech. The Government did not argue it at sentencing and now this panel did not even enter it into its consideration and blatantly and unlawfully stated that the protected speech, already adjudicated fully, could still be punishable under “history and characteristics” of a Defendant. This panel further entered into a predisposed opinion that “even non criminal behavior” can be considered for sentencing but did not clarify what non criminal behavior could be considered? This unlawful opinion, left too broad, would be unconstitutional as this court could deem discrimination such as race, religion, and sex as basis for sentencing under history and characteristics of the defendant.
Additionally, any defendant has a right to due process, appellate process and judicial complaint. In fact, the burdens of compliance for any defendant can be quite intimidating. In judicial complaints, according to this Courts own statistics; more than 70% of complaints are dismissed for technical reasons of non compliance. However, in this case where the Chief Judge does not investigate the complaint and dismisses it, and the Clerk of the Court does not follow procedure and then colludes with the Chief Judge to cover it up and make judicial decisions on her own that involves the liberty of a citizen, has great society benefit in making sure this is not allowed and is held accountable.
Lastly, the obvious corrupt decision by this court numerous times to allow Hurley to even be involved with this case and not recuse himself nor be forced to recuse himself is an abuse of authority and absolutely has no basis in law.
Procedural Errors by Panel that need to be Reheard
This panel also deliberately and unlawfully misinterprets that the letters themselves were proven beyond a preponderance of evidence simply because they were written, not the actual violation of true threats. This is simply a biased, prejudice and predisposed reach to justify a corrupt decision and protect the Government and the Court.
The panel also alluded to the fact that under 18 U.S.C. 3661, the Court can consider “non-criminal behavior”. Firstly, the law does allow for acquitted conduct to be considered for sentencing. In almost all cases though, it is a jury trial in which the defendant was convicted of some crimes and acquitted of some, but the Judge can find “by a preponderance of evidence” that the jury was wrong and consider the acquitted conduct anyway for sentencing and enhancement. The Court may also consider dropped charges in a plea agreement. In a majority of these cases, such as drug cases, the acquitted conduct was similar in nature to the overall conduct of the defendant. Under USSG 1B1.3, even “relevant conduct” can be considered. That is why the law is allowed. However, in this case, the Court exclusively considered a constitutional right for sentencing. This panel wrongly stated that all behavior, criminal and non criminal can be considered. So, if a person like the appellant can be sentenced to prison for protected speech, then any Court can consider any other constitutional right in sentencing? What’s to stop the Court from considering other rights like race, sex, religion, sexual preference, or even how a person looks? Under this panel’s decision, all those things are fair game?
This panel deliberately included an edited version of 3661. However, the key is at the end of the entire language of the law. It states:
“in determining the sentence to impose within the guideline range, or whether a departure from the guidelines is warranted, the court may consider, without limitation, any information concerning the background, character and conduct of the defendant, unless otherwise prohibited by law.”
Hurley exclusively considered acquitted conduct not found by a preponderance of evidence. That was prohibited by law. In United States v Watts, 67 F. 3d 790 (CA9 1995), the case involved the exact example of what was mentioned above. The Defendant was acquitted by a jury of a gun charge. However, the Court found him guilty by a preponderance of evidence and allowed to consider it for an enhancement in sentencing. In the Supreme Courts discussion of the case, it clearly states, ‘every other Court of Appeals has held that a sentencing court may do so (consider acquitted conduct), if the Government establishes that conduct by a preponderance of evidence.” The Supreme Court also further states that, “requires the sentencing court to consider all acts and omissions that were part of the same course of conduct or common scheme or plan as the offense of the conviction.”
The Supreme Court further states, “an acquittal in a criminal case does not preclude the Government from relitigating an issue when it is presented in a subsequent action governed by a lower standard of proof.” (Dowling v United States, 493 U.S. 342, 349 (1990). It also states, “the guidelines state (USSG 6A1.3) that it is “appropriate” that facts relevant to sentencing be proved by a preponderance of evidence, and we have held that application of the preponderance standard at sentencing generally satisfies due process.” (McMillan v. Pennsylvania, 477 U.S. 79, 91-92) (1986). The Supreme Court finally ends with this statement; “we therefore hold that a jury’s verdict of acquittal does not prevent the sentencing court from considering conduct underlying the acquitted conduct, so long as that conduct has been proved by a preponderance of evidence.”
This panel cited Watts and deliberately denied due process of the appellant contrary to the Supreme Court’s ruling. Unlike the example cited above and in Watts, the appellant was charged and fully exonerated of all charges first by a preponderance of evidence standard. The Government and court simply used a technical rules violation as a backdoor to punish the appellant anyway. The Court conducted a full hearing at tax payer expense over 4 months, found the appellant innocent of the corrupt allegations by a lower standard of evidence, only to use the allegations against the appellant anyway in violation of the law and Supreme Court and Second Circuit and other appellant court decisions.
But this panel didn’t need to pretend to consider the underlying facts from a third party, disinterested observe to make a decision as to whether Hurley should recsue himself or not. No, all they had to do was follow the lead of their own colleague Judge Denny Chin who recused himself from this case. Chin rightfully recused himself because he was a recipient of one of the letters the Government introduced as evidence against the appellant. That letter asked a question how a guy like Chin can be born in Hong Kong but yet deny due process to a citizen born and raised here? I asked if he thought I could go to Hong Kong, be a Judge and have a part in sentencing their citizens to prison for protected speech and helping a young man with legal work.
Chin recsued himself because he thought he could not be impartial. He had taken part in denying my Writ of Mandamus against Hurley. He did the right thing. So, the question to this panel is Chin recsued himself over one letter of innocuous content addressed to the three members of the Second Circuit panel, but Hurley was the recipient of 6 of those letters directed to him personally and this court found that Hurley could be fair and impartial while their own panel member recused himself? That is pure bullshit and a total abuse of interpretation. Or better yet, not an interpretation at all and just an abuse of authority.
The appellant filed a judicial complaint against Denis Hurley in May 2013. The appellant requested Katzman not rule on it. He ignored the request and wrote a one page denial and obviously did not investigate the complaint for if he did, it would maybe have been disclosed that Hurley was indeed biased, partial and prejudice. A proper investigation and decision to recuse Hurley would have saved the appellant from a corrupt process and 10 months in prison. The appellant appealed the decision to the Second Circuit Court of Appeals Council which was compliant and timely.
In February 2016 the appellant called Clerk of the Court Catherine O’Hagan Wolfe to see what was going on with his appeal. A week later, the appellant received a letter from Katzman’s Secretary Ms. Karen Milton that the Clerk’s office had made a mistake and they did not forward his legal appeal to the Council. The appellant followed up with a letter demanding justice and accountability. A week later the appellant received a letter from Wolfe stating that the “case has been closed and the decision to not recuse Hurley would stand.” Since when does employee’s of the Court make judicial, self serving decisions of law?
A complainant has to go through hoops to comply with all the rules to file a judicial complaint. The Court on its website even admits that over two thirds of submissions are dismissed for “technical violations.” For a lay person it is a daunting and exhausting task to seek justice. The penalties of non compliance are dismissal. But when employees of the Court make a fatal error, there are no penalties? The appellant serves 10 months in prison and another year of Supervised Release partially due to their error and there is no accountability? This is unacceptable to say the least.
The only “slippery slope” being executed is being done by Government and Court officials abusing the trust and authority given by society. Congress has mandated the Courts to use incarceration as a “last resort.” It isn’t good enough that over the past 30 years the US has incarcerated more people in the history of mankind? And now Hurley punishes constitutionally protected speech but reasons that he can be “preemptive” and not have to wait until an actual crime took place. It isn’t good enough to have over 5 thousand laws to choose from, but now this panel is going to allow Courts to be clairvoyant and imprison innocent people because of a slippery slope?
Tyranny is nothing new. It is up to any individual or member of an organization to determine what he or they must do to seek justice. Nelson Mandela stated that, “man is incapable of accepting oppression and will seek out all the good things life has to offer.” The appellant has simply used the courts to seek justice and followed every legal pursuit of due process only to be denied at every turn by corrupt people. As far as true threats in any letters, if the appellant were to make a decision to harm or kill any Government official responsible for taking away his life and career, he wouldn’t write them first, Wouldn’t he just seek them out and harm or kill them without advance notice? All this fear mongering by Hurley and others is simply baseless rhetoric to justify a corrupt process.
The appellant writes this appeal knowing full well this panel and court are corrupt. But it is the only legal thing left to do. If this panel continues to deny due process and justice, the appellant will pursue a writ to the Supreme Court. The decision to not release the appellant from the criminal justice system was unlawful pure and simple. This is this Courts chance to right a wrong and most importantly to vacate a dangerous precedent. For the benefit of society, you cannot have courts use tax payer money to pursue personal vendetta’s, only to lose in court, by a preponderance of evidence no less, only to then use an unlawful, broad deliberate misinterpretation of law to throw someone in prison anyway. The appellant has already served the prison sentence. He has completed the anger management program. He has completed more than half of the additional supervised release. The appellant receives no benefits really other than knowing that this Court will not allow an unlawful and corrupt decision to be used against anyone else.
Do the right thing.
Dated: August 19, 2016
Pro Se Appellant
19-19 24th Avenue
Astoria, New York 11102
(P) (347) 242-3099
(M) (646) 220-9900
Yesterday, today and the for the foreseeable future, the media will engage in a feeding frenzy of reporting on FBI Director James Comey’s press conference announcing specifically how Hillary Clinton acted recklessly (but not criminally negligent), and he would “recommend” to the Department of Justice not to file any charges against her.
Already most media reports focused on the highly unusual FBI process. It highlighted also that the FBI admitted that anyone else would have been penalized in some way, maybe even criminally, but under our current system of double standards, police state for some, and selective prosecution, Secretary Clinton will benefit from being part of a ruling class.
The public will argue that the “Government” is going soft on Ms. Clinton. The USA already holds the world record in mass incarceration and the “mob” will never be satisfied. For a so called “Christian” country, the US is a brutal, punitive society where the process of sending people to prison has become a spectator sport. In this Police State, we have two leading Presidential candidates that could have both been facing federal indictments. If that doesn’t show where we are as a society, nothing will. Trump already facing a civil case about Trump University brought obviously for political reasons. And of course now Ms. Clinton was cleared of criminal wrong doing, but highly dented and has been the favorite Republican punching bag for years. In all candidness, Ms. Clinton should have been sent to prison for the cattle futures trading she did (or didn’t do) years ago where she made thousands of dollars on a small amount of money.
The media is armed with the unfairness of our criminal justice system but mostly refuses to report on it.. As evidenced by the FBI’s own words, it is selective prosecution. Director Comey stated about Ms. Clinton’s and her staff’s lack of “intent” when in fact our lawmakers deliberately leave out “mens rea” or intent from the law. They allow prosecution on “objective” standards and thus one of the main reasons for the largest mass incarceration rate in the history of mankind. Millions of people, mostly poor black men, are sent to prison every day for lack of intent.
I will now once again argue my case. Loretta Lynch has personally been part of my selective prosecution for over 19 years now. Through collusion with a corrupt court and Judge, she was able to send me to prison for 10 months for simply helping a young man with legal work who was doing time in New Hampshire. That case is under appeal to a corrupt appellate court, but I have already served the prison time. Lynch is now under fire for allowing former President Clinton on her luxury plane in Arizona. Clinton appointed her in 1999 and I was one of her first cases which she lost. The timing now makes sense. Comey states that he didn’t speak with anyone, including the DOJ about his press conference, but the media reported a day earlier that Clinton wouldn’t be charged.
In my personal opinion, FBI Director Comey did the right thing by not charging Secretary Clinton with criminal charges. Millions of dollars were spent to investigate the email saga and there was a ton of political will behind prosecution. The main issue that I have been advocating is that law enforcement in this country is a trillion dollar a year industry. Yes, I have advocated violence because I fear that the ruling class will not stop selective prosecution. History has continually showed the ruling class never stops until they are forced to stop. Enclosed is a timeline from 1997 until the present. Every single Government agency has taken a shot at me, some multiple times. I have never faced a “reasonable” prosecutor. One of the main reasons is that Government officials like Ms. Clinton are never held accountable, but a young black kid with a few joints is thrown in prison for decades, or shot and killed like every 28 hours.
Over the last 16 years, I have faced 4 criminal prosecutions, a diversion agreement, 3 Supervised Releases, 6 regulatory proceedings, three appellate proceedings and unlawfully imprisiuoned 3 times, most of it locked up at maximum security federal prisons 24/7. I would have liked the same careful consideration that Director Comey gave to Ms. Clinton, but guess what, that didn’t happen, nor is it likely to happen anytime in the future unless people get up and do something about it besides tweeting and writing.
Dear Media, Senators and their Staff, FCM’s and Others,
In all intensive purposes, the CFTC is a criminal organization. I have been exposing them since 1997. In return, they have not stopped their personal vendetta against me. A former CFTC attorney who worked there for 25 years told me years ago, “it is the most criminal organization in Washington. “ That’s saying a lot.
Unlike their big brother, the SEC, the CFTC doesn’t get many headlines. You would think that when CFTC Administrative Judge George Painter came out in 2010 telling the world that the CFTC arbitration practice was corrupt and had been for his 25 year tenure, you would think it would raise some flags? Then, nearly at the same time, you would think that the case of Russell R. Wasendorf, Sr. would certainly expose not only the CFTC, but its partner in crime, the NFA. I mean the guy mimicked the exact long term fraud that Bernie Madoff did with slightly less gross numbers, but right under the noses of the CFTC and NFA. And just like Madoff, unbelievably, the guy didn’t do a single trade in 20 years! They still didn’t catch him and he turned himself in. Then you have Jon Corzine. But mostly, you have corruption and cronyism the world never even sees or hears about. And of course all the time the CFTC cries they don’t have any money to combat “all the fraud”. Contrary to what the CFTC says, FCM’s are shrinking massively and the CFTC’s only hope of a future is grabbing onto the OTC market for regulation.
My case is well known. My little fund made a net audited return of 138% in 2008 and 2009 while the world was embroiled in a financial crisis not seen since the great depression. My fund was ranked by major independent databases as one of the best performing multi strategy funds in the world in 2008 when the fund first started. During that time, the fund innocently traded three months of financial futures per counsels advice that as long as the fund did not have more than 15 clients and did not hold itself out as a CPO, it was exempt from registration. In September 2008, the fund never traded futures again and concentrated on trading stocks and options for its investors which it was also highly successful.
In 2009, while Rome is burning in the background, the CFTC and SEC executed massive subpoena’s on my little $15mm fund forcing it to close. They subpoenaed all my accountants, administrators, auditors,, prime brokers and even the investors themselves asking for “any dirt on Mr. McCrudden.” In December 2010, Gary Gensler sued my little fund for $58mm for a ‘simple registration violation.” Gensler then organizes a raid on the home of my ex wife in concert with the FBI while I am 10 thousand miles away in Singapore. I had not lived there since 2006 and the cowards interrogated my 19 year old daughter. My reaction to this corrupt case led to criminal charges. Although I was extorted to plead guilty, I believe to this day it was protected speech. My reaction was certainly well deserved.
From then until now, the CFTC has been pursuing this case while Gensler is on to bigger and better things. They have cost American taxpayers millions of dollars while stating to Congress they are underfunded. The CFTC attorney, Jim Holl, has stipulated that never in the history of the CFTC had they ever brought a simple registration case directly to federal court. My attorneys and I have had no luck in even finding even a comparable case….until now.
In October 27, 2003, the CFTC brought administrative charges against a company called Boston Advisors and its two principals, Andrew Preston and Thomas Brazil (enclosed). This was unlike my case where they brought charges a year after the fund was already closed directly to federal court. They charged Boston Advisors with a registration violation and other things, but unlike my case, never charged the two principals as “control persons” CEA 13(b). They also never added up the two years trades they had been in business and sued them $130k per trade as they did to me. Maybe because one of the principals. Andrew Preston was a former bulge bracket trader from Citibank and we all know under regulatory capture how the big firms are favored over small firms by the regulators. The CFTC brought and settled the case the same day as they do for most big firms. The CFTC allowed Boston Advisors and the two principals to submit registrations with the NFA. Three months later in January 2004, all were registered and back in business where they stayed until 2008 when they most likely blew up while I was making my investors a 99.6% net audited return.
I just read that Andrew Preston in February 2016 just registered himself with a company called Mark Anthony Trading. It states that he holds a greater than 10% interest in the company. His title? Chief Compliance Officer!
It also looks like Preston’s other partner, Thomas Brazil was charged by the SEC and DOJ with fraud in a pump and dump in 2014.
My case is 6 years old and 8 years removed from the innocent potential registration oversight. Society and the media fault me for overreacting and threatening regulators. Since serving 2.5 years in prison directly for this case, I ended up serving another year indirectly because of this case. And I didn’t spend it at no “club fed.” No, my time was spent at maximum security administrative prisons locked down 23/7 and for extra badness, placed with a managerial variable and public safety factor making my time harder and placing me in mortal danger. The CFTC refuses to settle in good faith as my family has begged me to try and move forward with my life which I can’t as the CFTC and other officials keep on tying themselves to my hip. The CFTC wants money which I no longer have any, and a lifetime trading ban which includes that I cannot ever again trade futures for myself or my family or children, while the above case demonstrates that they were allowed to register and continue to trade their fund. If allowed to continue, there was no telling how successful I would have become. But the CFTC made sure that I cannot even open up a trading account to make a living which I had done successfully for 25 years. No one sees the amount of time and effort that went into being a successful manager. During those stressful time of 2008 and 2009, I sometimes only slept a few hours a night. And for the three years previous to opening up the fund, I spent hours upon hours researching and fine tuning my methodology to become a successful manager. And it was all taken away from me by a few scumbags for sport.
I have tried every single legal venue to try and hold anyone at the CFTC accountable or even answer to their unlawful pursuit of me. The media will print a story and post my mug in their paper the minute I say even a veiled threat, but not say a word or do any investigative work as to why the CFTC and its corrupt officials are allowed to use millions of taxpayer dollars to pursue personal vendettas? Is that the country we live in now? Tell me, I want to know?
In August 2014, after Michael Brown was shot to death in St. Louis and Eric Garner was choked to death here in New York City, I wrote an article called “Revolution Required.” It was a standard call for civil disobedience and the essence of the article was traditional political discourse and hyperbole protected by the First Amendment.
On November 14, 2014, I was arrested. My home raided by 25 armed federal officials. My deaf sister and wife awakened from a dead sleep. All of my computers and phones unlawfully seized and searched. I was denied bail and placed in a maximum security administrative prison for 4 months when in March 2015, I was exonerated. The charges stemmed around 9 pleadings written to various courts and judges as a litigant and complainant.
The interesting thing for me was the Governments submission of “evidence” of this article and web posting called Revolution Required. Even the corrupt Judge, Denis Hurley, never considered it for a moment stating, “this article is traditional political hyperbole” and “well acknowledged, debated and matter of record and case law to be protected speech.”
So, how did it get there? It turns out that I had a history of emailing over 200 media anytime I submitted something to the courts. After being abused and targeted for over a decade, I wanted someone to bear witness to what was being done to me and how I was fighting back in the courts. It’s funny, with over 400 pleadings over the course of 2 years, not a single reporter contacted me about a single pleading, but anytime the Government said something about me, they printed it word for word. That is when I started to call the media “stenographers.” Yesterday, Donald Trump railed against the media as he has witnessed firsthand what a despicable business it is and what cowards most reporters are.
It turns out through discovery that reporters at Reuters, Douwe Miedma, Emily Stephenson, Allison Frankel and Sarah Lynch handed the article over to in house counsel at Reuters who then automatically handed it over to the US Attorney’s office. When I saw the communications in discovery, I was sick to my stomach. I could see that Miedma told the lawyer, “here is another article by McCrudden.” It confirmed that he had been receiving and reading all of them, but did not lift a single finger to contact me or investigate a single thing.
Reuters, like all media, rely on the First Amendment to have a business model in America. In this example it is clear they do not investigate anything that doesn’t come from the Government. Reuters in particular is the PR firm of the Government and evidenced here that they work behind the scenes and coordinate with Government officials. It is shocking that reporters, management, staff and counsel at Reuters would abrogate the very laws that keep them in business. I have called Reuters office of general Counsel and left messages for a woman named Dori Harris 5 times over the past month to have a conversation about the situation, only to be ignored. Miedma has left Reuters and now works for “an intergovernmental organization” not surprisingly. The other reporters are still there getting all their leaks and leads from Government officials. So, Trump knows what he is talking about when he speaks of the media. Its just a shame that so many men and women over many years fought and lost their lives for freedom of the press and speech, only to have scumbags like Reuters undermine it.
Date: October 5, 2015
Location: MCC Manhattan Federal Maximum, Administrative Prison
Judge Denis Hurley
934 Federal Plaza
Central Islip, NY 11722
Cases: 11-CR-0061 & 10-CV-5567
The reason I don’t write formally address you as Judge is firstly because you have abrogated that right because of your bias, partiality and corruption and secondly because I will do everything in my power to strip you of that title, have you fired, strip you of your pension and expose you for what you really are and that is a weak little coward of a man.
In India, there are literally thousands of different dialects. Language is an important and critical way of communicating. Some words, although identical, have different meanings depending on what context you say the word indicates to the listener the way you mean it. Even so, language can still be misinterpreted all the time, especially the written word because of lack of intonation.
For over ten years now, I have used language partially as a form of protest against cowards like you. Mostly, I have stayed within the realm of acceptable language utilized by the everyday man. Even against my will, I have utilized legalese language to conform a little with the norm of the Courts, but knowing deep down through experience it was simply a game within a corrupt system and oppressive and unjust process.
Loretta Lynch, Chris Cafferone, and other cowards like yourself prefer to work behind the scenes. You have used millions of taxpayer dollars to scrutinize my use of language, distort it, and arrange it in a montage to suit your own predisposed agenda for the simple self serving purpose of abusing your authority.
Many people have questioned the use of my minority language. Firstly, they have not read the plethora of documents I have produced over the past 18 years seeking justice. Over 99% of my language utilized was proper, formal, polite, legal and acceptable language. Unfortunately, language that was totally ignored. At the request of family and friends, I stopped writing altogether since my illegal arrest, illegal search and illegal detainment last November. Their common, logical reasoning was that if I stop writing, the Government officials will stop pursuing me. I disagreed because I know these Government officials and what lowlifes they are, but I consented none the less. But once again, here we are after not writing anything for a year. Society doesn’t understand that Government bullies and cowards like yourself don’t stop until they are forced to stop. Cowards like you don’t get their hands dirty and instead collude with the US Marshals, Loretta Lynch, that moron and puppet Cafferone and the DOJ to raid my homes, interrogate my children, scare my deaf sister, intimidate my fiancé, arrest and detain me.
You called me “dangerous” in Court, but it is you that is the true danger to society. How can someone who has zero history of violence in their entire lives be called dangerous in a United States Federal Courthouse? Ah yes, because of language. Cafferone, Lynch and yourself devised a scheme from January 2011 to promote a ridiculous premise that, “what one writes is usually what they intend to do.” In that case, someone should go lock up Stephen King. I even testified against this ridiculous premise and gave examples, but you’re not interested in anything other than what promotes your shared agenda. However, your little corrupt game took a turn for the worse on August 18, 2015. You were so hell bent on justifying a maximum sentence for simple innocuous, legal correspondence and assistance that you shot your own self in the foot. Of course I have documented how corrupt you were from day one and have used herculean efforts to disclose your collusions, corruption and illegal ex parte communications. I have sought all the proper and legal channels to have you investigated and hold you accountable. My lawyer requested politely for you to end this charade and “release me from the criminal justice system.” But you had an agenda. I laughed a little at your attempt at sentencing to add a clause to the First Amendment of the US Constitution regarding a litigant’s right to communicate with the Courts in a case. Your overreach was so obvious and pathetic, but it will come back to haunt you.
To deliberately distort the record and try and screw me, you actually screwed yourself by disclosing that for the first time on the record that, “for the first time in my life I started using a burglar alarm.” This statement, combined with previous statement of you wanting to be material witness and communicating with the US Marshal disqualifies you. Did you seriously believe that “any reasonable person” would believe that someone with absolutely no violent criminal history made a Federal Judge use a burglar alarm? A Federal Judge over 20 years who has sentenced murderers, pedophiles, organized crime figures, violent gang members, international arms dealers, wealthy businessmen, etc. None of those types of individuals made you “so fearful”, but someone with zero history did? Its so obvious a lie and so pathetic its actually comical. I have told the story to “reasonable people” all the time and all they do is laugh.
The “danger” you speak of is not physical in nature as you would like to indicate simply because you lack any evidence. No, with cowards like you, it is always disclosing the lie that you are most fearful. When an adulterer cheats on their spouse, they almost always think their spouse is cheating on them. It is the guilt and paranoia that convinces them and justifies in their mind their own transgressions. Such is the case here. Because it is you that is the guilty one that is trying to deflect the attention away from you. You are nothing more than an adulterer, but then again, a strong woman despises a weak man like yourself.
Legally, it doesn’t really matter which lie you have told, the facts stand that you are indeed a liar. The blatant facts on the record prove now you perjured yourself. The Senate Judiciary Committee or the Second Circuit Court of Appeals Council can choose to investigate the lie about the burglar alarm. I am sure that is the tip of the iceberg. Usually liars like you cannot stop at one lie and since this lie involves other people, it’s just a matter of time before someone else with knowledge will come forth with information.
Of course the main perjury occurred over the last 4.5 years when you stated on the record that you could be fair and impartial in my cases. You even installed your own little foot soldier John Carman to do your dirty work. Yes, I am aware of how many cases you give him. But I was to smart to trust Carman and although you cleverly used his testimony about recusal, I still made sure my wishes were added to his brief that I still wanted you removed. The facts are that Carman extorted me into not saying anything stating, “if you seek Hurley’s recusal, you will only piss off the other Judges and they will be even more biased than Hurley.”
You and Cafferone think your collusion about “escalation” is a valid legal argument. My lawyer, rightfully so, has challenged the legality of this pathetic argument many times. If and when language crosses the boundaries of protected speech, then by all means have your minions indict that person. In the meantime, you have no authority to be the moral police. You have no authority to be “preemptive”. In fact, again like the danger issue, it is you and the Government officials that are constantly “escalating”. Think about it. For ten years I have pursued legal recourse. In fact, I believe I have set a world record trying to hold accountable corrupt Government officials bad behavior. But, to a reasonable person, I have been more than patient and most of all consistent with my language, process, purpose, cause and methods. It is I that has continuously asked to be “left alone” (See Termination of Supervised Release Motion) and it has been you that continually seeks engagement with me. If you are genuinely “afraid” of someone, you don’t continually seek out engagement with them. You had personally had two chances to leave me alone last year and you chose not to. You have been entrusted to act on societies behalf, and you have violated that trust. You have colluded. You have acted and ruled with bias, partiality and personal prejudice and you will be fired for it. You should face criminal charges. I will sue you and bankrupt you. If you are thinking the “institution” or “state” will protect your actions, think again. The state will always protect itself and throw you under the bus the first sign of unlawful conduct like you have continually down in my cases.
My lawyer will pursue the appellate process for justice, but we, my family, and others are well aware of what you have done to me. First, you colluded with Loretta Lynch and Cafferone. The Government didn’t even submit a brief knowing you already had an agreement in place. Cafferone knew acquitted conduct is prohibited from sentencing consideration, but did it anyway with your approval. The Second Circuit is full of cases stating this fact. And then of course you violated my rights of double jeopardy by sentencing me again for the underlying crime. You admitted on the record you regretted not sentencing me to more time even though you had already sentenced me to a month more than I plead to, and sentenced me to double Supervised Release from what the Government was requesting. All the time well aware that denying me bail would guarantee me serving at least my prison part of the sentence. And then of course now come up with some Bullshit reason to STILL not recuse yourself. Why would the CFTC defend your recusal if you were not handpicked from the very beginning and had an openly biased and partial agenda against me? Why would the CFTC care what Judge oversaw the case unless they had a purpose and reason? Its already six years old and you have done nothing to adjudicate it!
So let the games begin. Start calling in your chips. Start calling in favors. Call Katzman again. Organize a meeting with Lynch, Cafferone and Dunne. Yes, please get organized and get all your stories straight. But know one thing. When I have written, “you have fucked with the wrong guy” or “be careful what you get back when you send a man to hell”, I meant fortitude, strength of commitment and character in standing up against corruption and oppression. I am sure Adolph Hitler and Josef Stalin thought they were great guys. But they didn’t murder and imprison everyone themselves. Over the last 30 years, you have been part of the greatest oppression in the history of mankind. Stalin and Hitler had help with people who agreed with their ideology, but mostly the cruelest people were cowards who abused authority and power and were just part of the overall movement. The next time you are in Court looking for the biggest coward and oppressor, look no further than yourself.
Personally, I will continue my efforts to bring attention to corruption in the Government. I will make sure you are removed first from my cases. This ridiculous, unlawful sentence of 10 months in prison and an additional year of Supervised Release for simply writing and legally helping a young man and his family benefit from a new law, Amendment 782, will not be tolerated and should not be tolerated by anyone in any society. In what planet, decade, century or society do you take away someone’s liberty for doing the Christian thing?
I know you. I know hypocrites like you. You go to Church every Sunday thinking you are Christian. You get off on the abuse of power. You represent no one but yourself and your little gang of co conspirators. You have abused your authority and position given to you by society. But I want to thank you. Thank you for validating everything I have written about you and others. I did not know the form in which justice would reveal itself, so thank you for trying to screw me and open a door. Judge Katzman should have investigated and disclosed your bias through my judicial complaint, but now I have ammunition to have you both investigated. Keep digging yourself a deeper hole by denying recusal and staying on my cases. You think Katzman, Raggi and others will have your back and legally protect you? Well, we’ll see. But as you know, I am no quitter and you cannot hurt someone when you have taken every legitimate thing from them. I am no coward like you. I hide behind no one and am on the correct side of righteousness. Ironically, the very laws you deliberately abused and misinterpreted for your own little agenda is going to backfire on you. Go back and read all the documents I have submitted over the past 4.5 years to the Courts, Second Circuit, Senate Judiciary Committee, etc. I
If it quacks like duck and looks like a duck, it must be duck.
Next week I will complete a 10 month prison sentence for simply helping out a young man with legal assistance. It could have been 10 years, no one cared. I have spent the last 3.5 years in federal prison, and not just “country club” as so many depict, but maximum security administrative prisons where you are locked down 23/7. I will never be the same person.
Every sentence in the United States is a life sentence. Even the process alone destroys you. It effects where you can live, what you can do to make a living, if you can at all, loans, benefits, etc.
Over the last 19 years I have been harassed, defamed, discredited, targeted, denied due process and incarcerated. I could not hold a single person in Government or a quasi Government agency legally accountable. The facts are I have not committed a single crime nor violated any regulatory rules. The record will show I have never attempted to steal a dime nor harmed another human being, but yet, I have endured the pursuit of every single law enforcement and regulatory agency alive. Millions of dollars have been spent ruining my life and career. I have not stolen a dime, not accused of ever attempted to steal a dime. I have never been charged with an assault, and outside the ring, never have hit another human being. I am not a rapist, murderer, drug dealer, never did drugs in my life, a pedophile, arms dealer, thief or member of any gang. How is it possible to have a life stolen for sport and no one care?
For the period of 2005 to 2009, I was probably one of the best trader’s alive based on pure returns. And yet, today, I cannot get a single job. All the Governments and media efforts to defame me far outweighed what I actually performed. For all you young people, in America, I am a prime example of it isn’t what you know, but who you know.
I have pursued every single non violent, legal forum for justice and even a forum to debate about justice. After 19 years, there is not a single interview of me or a quote. The people in power want no part of that. And what I have learned, neither do people. They want to be dominated, they want injustice. They love to read about abuse, until it happens to them. This country identifies itself as “Christian” when it is the farthest thing from it. Modern America is the camel trying to go through the eye of the needle.
I have written over the years about all the statistics about the unfairness of the US Financial Regulatory Industry and US Criminal Justice System. 12-13 million people are arrested each year and 65 million with an “M” have a record. The wealth disparity is at an all time high and the greatest transfer of wealth in the history of mankind occurred from 2007 until the present, and not one single banker went to jail or even had to answer to it.
Race is nice answer to all of this, but it’s simply not 100% of the facts. The two prisons where I just served my time, nearly 100% of the Correction Officers and Staff are all black. The facts are as they have historically been is power and money, its class warfare. Even Warren Buffet is embarrassed stating, “if it is class warfare, my class is winning.” Somehow, the idiot “feeder agencies” think they are part of the upper class. They are the real traitors of society doing the rich class dirty work.
I have done my part. I have had my say. I anxiously await my real judgment day and content knowing that I acted for the best interest of myself, my family and society, and society was too cowardice to join me. Twenty trillion dollars in debt and growing. The rich not only robbed you, but robbed your children and grandchildren and you didn’t lift a finger. I hope I get a seat awaiting your judgment day. Good luck.
In December while illegally incarcerated at MCC Manhattan, I was interviewed by Brandon Stanton, the founder of Humans of New York. I agreed to do it to bring attention to all the illegal things done to me over 19 years, especially the latest corrupt acts over the past year. My case is under appeal, but not before I had to serve out the prison part of the sentence as the corrupt Judge, Denis Hurley, denied me bail pending appeal. How convenient for him.
Brandon is a photographer by trade, but started to do human interest stories attached to his pictures. I believe he says he has over 20 million Facebook followers. He started to ask why I was in prison and I said I was innocent. He didn't believe me and my story was too long for him, so he asked me when I felt the "most afraid" in my life. Thus, I told him about my experience surviving 9/11. He took a picture when I was remembering the time when an MTA attendant told me the buildings were gone. I had friends who worked there, and thus eventually lost 23 friends that day. Anyway, kudos to Brandon for capturing a moment when I was back in time and reliving the pain. You will see all the Facebook comments about the "sadness: in my eyes. Yes, there is sadness from that day of course and the loss of life and friends, but also from being harassed, targeted, and incarcerated by corrupt Government officials. But also because of being abandoned by friends and family over the last 19 years. Yes, those eyes are a vision of sadness and lost hope. Enjoy.
Humans of New York:
Welcome to the Project For Government Reform. It is the hope this organization can help educate the public about the US criminal justice system, and the US Financial Regulatory system. Both are in need of drastic reform. Please feel to submit comments and articles openly. Thank you for visiting, your feedback and for your efforts to make this country a fairer place to live and work.
Vincent McCrudden is Founder of Project For Government Reform.