The U.S. Securities and Exchange Commission filed charges in federal court in Manhattan against Lithuania-based Justinas Butkus and two entities he owned and controlled, HMC Trading LLC and HMC Management LLC, alleging they raised approximately USD 4.1 million from 64 investors by selling interests in mutual funds that did not exist. According to the complaint, Butkus operated fictitious investment firms TBO Capital Group and Gray Capital Group in late 2021, using the alias Darius Karpavicius and promoting sham mutual funds through websites, a press release, and online advertisements containing materially false statements about fund managers and past returns. The SEC alleges the purported managers and biographies were fabricated, no investments were made, and most investor funds were diverted for personal use, including restaurant spending, cash withdrawals, and crypto asset purchases. The complaint alleges violations of registration and antifraud provisions of federal securities laws, names DK Auto LLC as a relief defendant, and seeks permanent injunctive relief, disgorgement with prejudgment interest, and civil penalties. The SEC said it is refiling an action it previously dismissed without prejudice on January 11, 2024, which had been brought against Butkus under his alias.
U.S. Securities & Exchange Commission 2025-02-27
U.S. Securities and Exchange Commission charges Justinas Butkus over USD 4.1 million non-existent mutual fund offering fraud
The U.S. Securities and Exchange Commission (SEC) has charged Justinas Butkus and his entities, HMC Trading LLC and HMC Management LLC, for allegedly raising USD 4.1 million from investors through non-existent mutual funds. The SEC claims Butkus used fictitious firms and false statements to promote sham investments, diverting funds for personal use. The complaint seeks injunctive relief, disgorgement, and civil penalties, naming DK Auto LLC as a relief defendant.