Office of Maryland Attorney General J. Joseph Curran, Jr.

April 18, 2001 Media Inquiries: Sean Caine 410-576-6357


Baltimore - Attorney General J Joseph Curran, Jr., announced today that his officeís Securities Division has obtained a preliminary injunction against a Prince Georgeís couple and their Bowie-based company, charging them with violating Marylandís securities laws by operating a fraudulent investment scheme involving millions of dollars.

According to the order issued by Circuit Court Judge Thomas P. Smith with the consent of the parties, all assets of Samuel W. Butler, Jr. and Nancy J. Ford-Butler and their company, S.W. Butler & Associates of 919 Cypress Point Circle, Bowie, and 8877 Spiral Cut, Columbia, are temporarily frozen and a temporary receiver has been appointed to take control of the company and its assets.

Curranís Securities Division alleges that the Butlers violated Marylandís securities laws by offering and selling unregistered investments and acting as unregistered securities agents and investment advisers. Allegedly more than 50 investors participated in the Butlers and S.W. Butler & Associatesí investment program and the Butlers offered unregistered securities for at least three years. The complaint also alleges that investors thought their monies were being pooled by S.W. Butler & Associates to invest in commercial notes issued by corporate entities, with the Butlers guaranteeing investors returns from as much as 10 percent within 90 days and rising up to 24 percent within 180 days. Investors were told that their investments were backed by collateral and protected by insurance coverage. The complaint, however, alleges that there is neither evidence that investorsí monies were invested in an investment program that generated the promised returns nor that the purported investments were backed by collateral or covered by insurance. Instead, the pleadings allege facts indicating that the investment program operated like a Ponzi scheme in that most of the money coming into the program was used to pay other investors who wanted to withdraw funds.

Curran emphasized that his Securities Divisionís investigation of this matter is continuing and urges anyone who invested funds with S.W. Butler & Associates or Samuel and Nancy Butler, or who has information concerning that investment program, to call the Securities Division of his office at 410-576-7783.

Curran reminded investors to call the Securities Division at 410-576-6360 before they invest to find out whether their investment adviser, broker and securities are registered. Even when an investment program looks reasonable, and friends and family trust the promoter, itís better to take a few minutes to verify the status of the promoters.