SEC Shuts Down California Man and Alleges Day Trading Scheme Targeted Seniors
On May 5, the SEC obtained an emergency order to halt an alleged securities fraud scheme that the commission said was being perpetrated by Robert C. Butler.
According to a litigation release, the SEC is alleging that Butler, of Bermuda Dunes, California, stole just under half ($1.6 million) of $3.3 million raised from at least 17 investors, the majority of whom were senior citizens. The SEC further alleges that the other half of the funds was lost through Butler's trading activities.
Butler, according to the SEC, "dazzled investors with his multiple
computer screens and a purported proprietary trading program" and
"promised exorbitant returns." He is also accused of falsifying
account statements in order to conceal the investment fraud, and hiding his 1998 bankruptcy
According to the SEC's complaint, Butler refuses to return investor funds and continues to lie to existing investors, telling them that repayments "are forthcoming." Butler also continues to solicit funds from new investors.
The Honorable Margaret Morrow, United States District Judge, froze Butler's assets at the SEC's request. A hearing is scheduled for May 11, 2011.