Broker Joseph Butler Barred and Fined by FINRA for Allegedly Defying Elder Financial Abuse Laws

One allegation against the former Innovation Partners LLC broker involved using an elderly client’s funds for his own benefit

Joseph Butler is no longer allowed to conduct business through any member of the Financial Industry Regulatory Authority (FINRA). The former broker was notified in October of 2016 that he has been permanently barred by FINRA due to several allegations.

It was reported that on different occasions, while working for Innovation Partners LLC out of Charlotte, NC, Butler withdrew funds from a client’s money market account and used some of it to pay outstanding tax payments he owed to the state of Maryland, with the rest going into his own personal bank account. The total amount of money he was alleged to have taken was $114,250. Butler’s business was called Future Security, Inc.

In addition, Butler’s client was elderly and suffering from progressive memory loss, though Butler claimed he was not aware of his client’s mental condition. FINRA, however, disagreed. According to their findings, Butler “began withdrawing money from the customer’s bank accounts for his own benefit after he realized that the customer’s health had declined and she was no longer capable of managing her affairs, and after he realized that there was no one else with sufficient knowledge to call him to account.”

As a result, Butler was forced to pay more than $170,000 in restitution to the client, along with other costs totaling over $5,600.

Elder Financial Abuse Laws

This was not the first time Butler had found himself accused of malfeasance. In 2012, he was fired from Woodbury Financial Services, Inc. in Clinton, MD, for failing to disclose that he was listed as a beneficiary on the accounts of several customers, though he wasn’t a family member. According to the SEC, “the advisor intentionally took advantage of an elderly woman who trusted him and whose declining mental health caused her to be unable to manage her financial affairs.”

To get more information about Joseph Butler and the allegations against him, you can read his BrokerCheck report.

FINRA has reported multiple cases of stockbrokers converting elderly clients’ funds, often by violating a relationship of trust where a customer comes to view the advisor more like a family member than a financial advisor. Brokerage firms generally prohibit a stockbroker from acting as a trustee or executor of a client’s estate. And if the financial advisor or stockbroker is treated as a family member and given access to bank accounts, or is named as a beneficiary of an estate, this information must be disclosed to the firm.

If Joseph Butler had been in charge of your accounts and investments, it’s possible that you are also owed money – and the Silver Law Group may be able to help you get it back. Scott Silver is the current chair of the American Trial Lawyers Association Securities and Financial Fraud Group, and our securities arbitration attorneys have years of experience recovering money for victims of fraud.

And because we work on contingency, you won’t need to pay us unless you recover lost funds. Get in touch with us today.