Former Glen Cove Businessman Pleads Guilty To Fraud

GLEN COVE, NY — The owner of a former Glen Cove company — who was extradited back to the United States from Costa Rica in July — pleaded guilty today to wire fraud charges in connection with a scheme to defraud investors.

David Butler 52, of Pittsburgh, Kansas, pleaded guilty to wire fraud conspiracy. He was arrested in Costa Rica in April and extradited to the US on July 15. He now faces up to 20 years in prison.

“Butler’s guilty plea demonstrates that even when crimes are committed from thousands of miles beyond our country’s borders using the latest computer software, neither the foreign nature nor the sophistication of the scheme will shield fraudsters from being brought to justice in a U.S. courtroom,” stated United States Attorney Breon Peace. “This office is committed to protecting the investing public from financial scams wherever they occur.”

According to Peace, from January 2011 to October 2016, Butler and others operated binary option companies SpotFN, Binary FN and Janus Options from locations in Glen Cove, Costa Rica and Kosovo. The companies promised to pay investors, who were from across the country, a predetermined profit based on investment outcomes.

However, the companies used computer software to manipulate the data associated with the investors' binary options so that the probability of them earning a profit would favor the companies. Butler and his co-conspirators never told the investors that the options they purchased could be manipulated to their disadvantage.

As a result of their deception, Butler and his co-conspirators stole more than $2.9 million from investors.

“David Butler and his accomplices employed a complex, multi-million dollar con to deceive investors by using a manipulated ‘binary option’ system," said Thomas Fattorusso, special agent in charge of the IRS Criminal Investigations in New York. "While investors waited for a surefire return on their investment, Butler pocketed the money to guarantee his own future — until he was caught. Butler now understands that his only genuine guarantee is that he will now face the consequences of his criminal schemes.”