CFTC Offered to Settle Lawsuit for $175,000, McCrudden Says
January 17, 2012, 12:09 AM ESTBy Thom Weidlich
(Updates with McCrudden comment in the fourth paragraph.)
Jan. 12 (Bloomberg) -- An ex-commodities trader who pleaded guilty to threatening to kill financial regulators, including Commodity Futures Trading Commission Chairman Gary Gensler, said the CFTC offered to settle a civil case against him for a $175,000 fine and a lifetime ban from the industry.
Vincent P. McCrudden, currently awaiting sentencing in a Queens, New York, jail, told U.S. District Judge Denis R. Hurley in Central Islip, New York, about the offer in a letter made public Jan. 9. Settlement negotiations on Dec. 12 were unsuccessful, according to an order by U.S. Magistrate Judge A. Tomlinson, who according to McCrudden “endorsed” the CFTC’s offer.
McCrudden, 50, pleaded guilty to two counts of transmission of threats to injure before opening arguments were scheduled to begin in his trial on July 18. The charges carry a maximum sentence of 10 years in prison. According to the government, he posted an “execution” list on his company website after the CFTC accused him in the December 2010 lawsuit of illegally starting his Hybrid Fund II LP in 2008 without registering it.
‘Manpower and Money’
“It’s a shame the CFTC is allowed to pursue, and commit valuable resources and millions of taxpayer dollars on a small business person like me,” McCrudden wrote in his letter, dated Jan. 5. “Manpower and money that could have been better utilized in pursuit of real regulation and enforcement like the current situation of MF Global and the alleged misappropriation of segregated customer funds in the astonishing amount of greater than US $1 billion.”
Dennis Holden, a CFTC spokesman, didn’t immediately return a call for comment on the settlement negotiations.
The criminal case is U.S. v. McCrudden, 11-cr-61, and the civil case is U.S. Commodity Futures Trading Commission v. McCrudden, 10-cv-5567, U.S. District Court, Eastern District of New York (Central Islip).
--Editors: Mary Romano, Glenn Holdcraft
To contact the reporter on this story: Thom Weidlich in Brooklyn, New York, federal court at tweidlich@bloomberg.net.
To contact the editor responsible for this report: Michael Hytha at mhytha@bloomberg.net.
