U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21130 / July 15, 2009
SEC v. Dmitriy Butko, Civil Action No. 3:08-CV-01201 (D. Conn.)
SEC OBTAINS DEFAULT JUDGMENT, DISGORGEMENT AND IMPOSITION OF THIRD TIER PENALTIES AGAINST BUTKO FOR ONLINE INTRUSION SCHEME
The United States Securities and Exchange Commission announced that on July 6, 2009, the United States District Court of Connecticut entered a Default Judgment against Dmitriy Butko ordering him to pay disgorgement in the amount of $60,362 together with prejudgment interest of $10,494.92 and imposing a civil penalty of $520,000.
The Commission began this action by filing a complaint against Butko on August 7, 2008. The complaint alleged that Butko engaged in a modern, high-tech version of the traditional pump-and-dump market manipulation scheme. Specifically, the Defendant was trading in the common stock of issuers on the National Association of Securities Dealers Quotation System (Nasdaq) whose shares were being manipulated through unauthorized intrusions and trading in online brokerage accounts of unsuspecting at U.S. broker-dealers in violation of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
For more information on earlier actions in this case, see LR-20675 (August 7, 2008).
The SEC's Office of Investor Education and Assistance has previously issued an investor alert, available on the SEC's website, which provides tips for avoiding becoming a victim of an online intrusion. See http://www.sec.gov/investor/pubs/onlinebrokerage.htm.