In the numerous threats money manager Vincent McCrudden made against SEC, CFTC, and Finra employees, he singled out one as the worst, the NFA’s Dan Driscoll.Driscoll, who McCrudden calls the “mafia don,” was the target of many of the threatening emails McCrudden sent, and there’s an easy reason why.
Basically, Driscoll made it really hard to him to ever trading legitimately again after he (allegedly) inflated the assets in one of his funds and lied about it to investors.
You’ll get the idea if you just read the bolded fragments.
In February 1996, McCrudden began a trading pool known as the Hybrid Fund [it was part of MAAM, his larger fund]. The Fund began with approximately $200,000 and grew to about $700,000 – $800,000 by June 1996. During that month, the Fund lost about $350,000 on copper trades.
Around August 1996, McCrudden learned that Sumitomo Bank etc were being sued for alleged manipulation of the copper market. [He hopped on the bandwagon, became a lead class plaintiff, and hoped to recover $2-$3 million.]
[The fund lost another $900,000 in September and October 1996, but never revealed the losses. Instead, he counted the amount he thought he’d recover from the lawsuit against Sumitomo as part of his assets.]
By June 1997, McCrudden realised that the Sumitomo litigation would take much longer than he anticipated, and that he could no longer avoid disclosing the fund’s situation. He notified investors in August 1997 that the Fund was unable to continue due to large trading losses…
McCrudden and MAAM withdrew their NFA membership in December 1997 and their registration with the Commission in December 1999.
In May 2002, McCrudden was indicted in the USDC and charged with multiple counts of mail fraud. The conduct underlying the indictment was McCrudden’s preparation of monthly statements for Fund customers that falsely inflated the true value of their investment. The same month he was indicted, the Fund was awarded $756,000 from the Sumo litigation. A subsequent award raised the recovery to about $800,000…
During McCrudden’s six-day trial in September 2003, the prosecutor presented 16 witnesses, including the Fund customers… and a substantial amount of documentary evidence. McCrudden testified on his own behalf. After deliberating one day, the jury acquitted him.
And now we get the answer to why he’s got a grudge against Dan Driscoll, the primary person McCrudden threatened to kill. Remember that MAAM withdrew their NFA membership in December 1997 and their registration with the Commission in December 1999.
In August 2004, McCrudden and MAAM again applied for registration with the Commission; [but the] NFA responded by issuing a Notice of Intent to Deny the applications [because of the allegations above]…
McCrudden submitted a pro se response, in which he challenged the allegation that he knowingly overstated the Fund’s net asset value and emphasised that the USDC had acquitted him in a federal criminal action raising the same allegations…
[McCrudden tried to dismiss the notice using the Double Jeopordy clause…]
The key documents supporting NFA’s adverse registration action — the false account statements — were not in evidence.
NFA attempted to call NFA official Dan Driscoll and McCrudden as witnesses… when counsel for NFA sought to cross examine McCrudden, he refused to answer, despite a warning from the Chairman of the Subcommittee…
On June 10, 2005, the Subcommittee issued its Final Order Denying Registration…
On appeal, McCrudden argues that NFA’s decision rests on an unprecedented and unduly expansive interpretation of the statutory language “other good cause.” He also claims that NFA denied him fundamental fairness by failing to grant him the procedural protections available in a criminal proceeding; that the record does not support NFA’s findings; and that NFA failed to consider his mitigation and rehabilitation evidence. Finally, he claims that denial of the applications is an excessive and oppressive sanction for the conduct established on record.
So there you have it. Vincent appears to have a grudge against Driscoll because he believes he unfairly would not let him register as a trader again. Look how many times he tried and you can see how the grudge festered.
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