Harris Bruce Landgarten of Old Brookville, New York, is facing both civil and criminal charges for defrauding investors in the Tradeanedge Members Fund (TMF), a commodity pool he operated. The Commodity Futures Trading Commission (CFTC) filed a civil enforcement action in the U.S. District Court for the Eastern District of New York on July 2, 2018, alleging Landgarten misled participants and commingled funds.
Simultaneously, the U.S. Attorney’s Office for the Eastern District of New York brought a related criminal case against Landgarten, charging him with commodity fraud, wire fraud, and obstruction of a CFTC investigation. The obstruction charge stems from Landgarten’s alleged attempts to influence a potential witness during the ongoing CFTC probe.
According to the CFTC’s complaint, from at least July 2014 through March 2017, Landgarten allegedly reimbursed himself with funds from the TMF account for expenses he characterized as belonging to the fund, without disclosing these withdrawals or expenses to investors. He then allegedly provided false account statements that only reflected trading gains, losses, and management fees, concealing the reimbursements.
The complaint further alleges that Landgarten failed to honor a participant’s request to withdraw their investment when the fund lacked sufficient funds. Due to poor record-keeping, Landgarten is also accused of withdrawing more money than the claimed expenses, resulting in the commingling of investor funds with his personal funds.
The CFTC is seeking full restitution for defrauded customers, disgorgement of any ill-gotten gains, civil monetary penalties, permanent registration and trading bans, and a permanent injunction against further violations of federal commodities laws. The investigation was conducted by Gabriella Geanuleas, Trevor Kokal, David Acevedo, Lenel Hickson, Jr., and Manal M. Sultan of the CFTC’s Division of Enforcement. The CFTC cooperated with the U.S. Attorney’s Office for the Eastern District of New York and the United States Postal Inspection Service during the investigation.
Source: CFTC.gov
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