Securities Lawyers Gone Wild – Bernard Butts

Bad Actor Ban l Securities Lawyer 101

Securities Lawyer 101 Blog

On July 15, 2014, the Securities and Exchange Commission announced that a federal judge ordered a Miami-based attorney to pay nearly $4 million in a consent judgment of an SEC case against him for orchestrating a prime bank investment scheme.

The money will be returned to investors.  Bernard H. Butts Jr. was charged by the SEC in September 2013 for acting as an escrow agent for a supposed international trading program that raised approximately $3.5 million from investors.  

According to the SEC Charges, the program didn’t really exist, and Butts instead doled out investor funds to enrich himself and others.

The SEC obtained an emergency order in U.S. District Court for the Southern District of Florida to freeze the assets of Butts and his companies Bernard H. Butts Jr., PA and Butts Holding Corporation before investor proceeds could be fully dissipated.

The Honorable Jose E. Martinez issued an order dated July 10, 2014, requiring Butts and his companies to pay $1,691,608 in disgorgement and $96,232.99 in prejudgment interest as well as a penalty of $2,059,284.19.  Butts and his wife Margaret A. Hering also must pay an additional $100,000 in disgorgement and $4,570.82 in prejudgment interest.

The SEC will return the money to investors through a Fair Fund.  More than $1.9 million already has been deposited from accounts belonging to Butts and his companies into the registry of the court following the asset freeze instituted at the SEC’s request last year.  And the court’s order requires the transfer to the court of more than $2 million separately seized by the U.S. Secret Service from accounts belonging to Butts and his companies.  The SEC will then submit a plan to the court for distribution of these collected funds back to investors.

Butts has consented to be barred from the securities industry or offering penny stock, and agreed to be suspended from practicing as an attorney on behalf of any entity regulated by the SEC.

For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit  This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. For more information about going public and the rules and regulations affecting the use of Rule 144, Form 8K, crowdfunding, FINRA Rule 6490, Rule 506 private placement offerings and memorandums, Regulation A, Rule 504 offerings, SEC reporting requirements, SEC registration statements on Form S-1 , IPO’s, OTC Pink Sheet listings, Form 10 OTCBB and OTC Markets disclosure requirements, DTC Chills, Global Locks, reverse mergers, public shells, direct public offerings and direct public offerings please contact Hamilton and Associates at (561) 416-8956 or [email protected].  Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates | Securities Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855