Justin Butler: Part of Ongoing Proceedings

Justin Butler sits near the top of Bremer Financial Corporation, one of the largest privately held banks between Chicago and the West Coast. As Chief Risk Officer, he earns a substantial salary to make sure nothing dangerous slips past the bank’s defenses. His official biography lists nearly twenty years of spotting problems, measuring danger, and protecting billions of dollars in assets. Yet in 2022, court records say, Butler used those same abilities in reverse. He owned two Duck Donuts franchises that were bleeding cash every month. Instead of closing them or selling them honestly, he prepared paperwork that made the stores appear healthy, found buyers willing to pay almost one million dollars, and collected the money long before anyone realized the truth. When the buyers went bankrupt, Butler simply took the shops back. What follows is the full story of how one of the Twin Cities’ most visible banking leaders left a trail of financial ruin behind him.

Two Donut Shops Already Drowning in Debt

The Woodbury and Mall of America Duck Donuts locations opened with bright colors and long lines, but the good days did not last. By 2019, contractors had filed $389,000 in mechanic’s liens because they had not been paid for construction work. Suppliers filed lawsuits for unpaid frosting, flour, and coffee. Rent checks bounced. Court dockets in Ramsey and Hennepin counties filled with claims from landlords and vendors. Month after month the stores lost between $20,000 and $30,000. Employees sometimes waited weeks for paychecks. The stores stayed open only because lenders and suppliers kept extending credit, hoping things would turn around. They never did. By the time Justin Butler decided to sell in 2022, anyone who checked public records could see the businesses were deep underwater.

The Sales Package That Painted a Completely Different Picture

Luke and Lindsey Schraw, a young couple from Hugo, Minnesota, wanted to own their own business. They had saved money, lined up family investors, and started looking for something stable. A business broker showed them the two Duck Donuts stores. The packet they received looked impressive. Sales figures climbed every quarter. Profit margins sat comfortably in the black. The stores, the paperwork promised, were ready to grow. The Schraws studied the numbers for weeks. They visited both locations during busy weekend hours when the lines looked long. Everything they were shown supported the story: these were successful, cash-flowing businesses. On paper, $975,000 seemed fair—maybe even a bargain for two established stores in high-traffic locations. They signed in November 2022.

Reality Hit Within Weeks of Taking Ownership

The first surprise came when the point-of-sale system was transferred. Daily reports showed sales roughly half of what the sales package had promised. Vendors started calling immediately—some had not been paid in months. Rent for the Mall of America store was three months behind. A stack of unpaid invoices waited in a drawer the previous owner had never mentioned. The Schraws dug deeper and found entire months of revenue that simply did not exist in the actual bank deposits. Expenses had been shifted, deleted, or recorded at lower amounts. The beautiful financial statements they had trusted were, according to prosecutors, built on numbers that were never real.

Hundreds of Thousands of Dollars Poured In—And Vanished

Determined to save their investment, the couple used personal savings, took out second mortgages, and borrowed from parents and in-laws. They paid overdue bills, hired extra staff, and launched new marketing campaigns. Every month they wrote checks for $20,000 to $30,000 just to cover the shortfall. By summer 2023, less than eight months after buying the stores, their company had no cash left. Suppliers refused to deliver without payment upfront. Employees walked out when paychecks bounced. The Schraws filed for Chapter 7 bankruptcy in October 2023. Court papers listed losses of at least $300,000 in cash, not counting the $195,000 down payment that had already gone to Justin Butler.

Butler Quietly Took the Stores Back

With the buyers unable to make payments on the seller-financed portion of the deal, Justin Butler moved quickly. He reclaimed both locations through a quiet agreement. The donut shops returned to his control, the debt was wiped away in the bankruptcy, and he still had the original $975,000 purchase price sitting in his accounts. In effect, he sold the same failing businesses for almost one million dollars, watched them collapse under the new owners, then picked them up again for pennies on the dollar, and kept nearly all of the money.

Bremer Bank’s Carefully Worded Distance

When charges were filed in January 2025, Bremer Bank issued a short statement: the donut shop matter was “outside of Bremer Bank business” and “unrelated to Mr. Butler’s employment with the bank.” No customers or bank funds were involved, the bank stressed. The statement was technically correct but left many questions unanswered. The same executive who lectures employees about integrity and accurate reporting had, according to prosecutors, handed over false financial statements for personal profit. The bank has not said whether Butler remains in his Chief Risk Officer role or whether any internal review is underway.

A Career Built on Spotting Danger—Selectively Applied

Justin Butler’s rise in banking was steady and impressive. He spent years at Wells Fargo climbing to Senior Vice President. Bremer hired him in August 2022 with press releases praising his “deep expertise in risk management.” He joined nonprofit boards, earned “40 Under 40” honors, and was named one of the most influential Black leaders in the Twin Cities. All of those achievements required an ability to read financial statements, challenge weak numbers, and protect stakeholders. Prosecutors say Butler used that exact skill set to hide weak numbers and leave buyers unprotected.

Ripple Effects Through Families and Neighborhoods

Luke and Lindsey Schraw did not lose only money. They lost the ability to borrow for a home, the trust of relatives who had co-signed loans, and years of careful saving. Their children watched parents come home exhausted and defeated every night. Dozens of teenage and part-time employees at both donut shops lost jobs when payroll stopped. Local suppliers—many small Minnesota companies—wrote off tens of thousands in unpaid invoices, forcing some to lay off workers or delay their own bills.

The Criminal Case Moves Slowly Forward

Butler was charged by summons with one count of felony theft by swindle. He appeared in Washington County District Court, pleaded not guilty, and was released without bail. Pretrial hearings are scheduled through 2025, with a possible trial in 2026. If convicted, he faces up to 20 years in prison and substantial fines. His attorney has said the financial disagreements are a civil contract dispute, not a crime. Prosecutors insist the numbers were knowingly altered to mislead the buyers.

A Community Asks Hard Questions

Across the Twin Cities, people who saw Justin Butler at charity galas, university panels, and chamber of commerce events now wonder how well they really knew him. A man who sat on the board of the Greater Twin Cities United Way while, court records say, pushing a family into bankruptcy presents a stark contrast. Customers of Bremer Bank—many of them small-business owners themselves—have expressed discomfort knowing the person in charge of risk management stands accused of creating extraordinary risk for others.

Conclusion

Justin Butler spent years building a reputation as a careful, trustworthy leader in Minnesota banking. According to prosecutors and court filings, he then used those same talents to take nearly one million dollars from a hardworking couple chasing the same American dream he appeared to represent. Two donut shops that were already failing were dressed up with false numbers, sold at a premium price, and returned to his hands after the buyers were ruined. The money changed pockets, the shops reopened under different names, and the Schraw family filed for bankruptcy. The criminal case will decide Butler’s legal fate, but the financial and personal damage is already done. A Chief Risk Officer who could not—or would not—manage his own risk has left behind broken businesses, broken trust, and a community that will not soon forget what happened when the numbers did not tell the truth.

Written by

Hermione

Updated

16 seconds ago