Litigation Release No. 15664 / March 10, 1998

     SECURITIES AND EXCHANGE COMMISSION v. SWEENEY CAPITAL MANAGEMENT INC.,
     TIMOTHY CHARLES SWEENEY, AND SUSAN MARY GORSKI, Civ. Action No. C 98-937
     MMC (N.D. Cal)

          The Securities and Exchange Commission announced today that on March
     10, 1998 it sued a San Francisco investment advisory firm, its owner, and a
     portfolio manager for misappropriating more than $109,000 in client-owned
     soft dollar credits and for trading securities for the clients without
     their informed consent.  The Commission sued Sweeney Capital Management
     Inc. ("SCM"), an investment advisory firm with offices formerly in San
     Francisco; Timothy Charles Sweeney, 44, a San Rafael resident; and Susan
     Mary Gorski, 41, a Larkspur resident, in United States District Court in
     San Francisco.  Sweeney is the sole owner and president of SCM, a
     California corporation registered with the Commission as an investment
     adviser from March 1993 until July 1997.  Gorski is SCM's vice-president
     and a portfolio manager. 

          The complaint alleges that SCM, Sweeney, and Gorski from April 1994
     through May 1995 defrauded SCM's advisory clients out of more than $109,000
     by purchasing and selling securities for the clients without disclosing
     that SCM was using soft dollar credits for its own benefit.  Soft dollar
     credits, also referred to as "soft dollars," are rebates from a brokerage
     firm generated when an investment adviser places securities trades for its
     clients through the brokerage firm.  Here, for example, SCM received a
     $1.00 soft dollar credit for every 1.75 of brokerage commissions generated
     by SCM's trades for its clients.  Soft dollars are assets of the adviser's
     clients.  Without informing their clients, Defendants arranged to have the
     brokerage firms use the soft dollar credits to pay for a variety of
     Defendants' business and personal expenses, including client gifts,
     telephone bills, marketing expenses, accounting and legal bills, postage
     and shipping, furniture, art work, business licenses, rent, parking, office
     supplies, and taxes.

          The defrauded clients included both individuals and a hedge fund whose
     assets SCM managed.  During its fiscal year ended December 31, 1994, SCM
     paid approximately 70% of its operating expenses with soft dollars
     misappropriated from its advisory clients and the hedge fund.  Without
     these soft dollar payments, SCM would have been insolvent during this
     period.  

          In addition to SCM's fraudulent misappropriation of soft dollars, the
     complaint alleges that SCM, Sweeney, and Gorski engaged in other fraudulent
     soft dollar practices.  At various times between April 1994 and May 1995,
     SCM, Sweeney, and Gorski submitted false invoices to soft dollar brokers
     for consulting work that was never provided to SCM in order to pay for,
     among other things, Gorski's salary, SCM's rent, and personal loans made to
     Sweeney.  SCM, Sweeney, and Gorski also submitted multiple invoices for the
     same goods and services in order to be reimbursed twice for the same
     expense.


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          Finally, the Commission's complaint alleges that SCM and Sweeney filed
     false forms with the Commission, distributed misleading marketing materials
     to the public, made false claims to investors about the competitiveness of
     SCM's advisory fees, misused client assets in its custody, and
     misappropriated an elderly client's funds.  

          In its complaint, the Commission seeks the following:  (i) permanent
     injunctions against future violations 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, and Sections 204, 206(1), 206(2), 206(4) and 207 of the
     Investment Advisers Act of 1940 and Rules 204-1, 204-3, 206(4)-1, 206(4)-2
     and 206(4)-4 thereunder; (ii) disgorgement of illegal profits; and (iii)
     civil penalties against SCM, Sweeney and Gorski.








































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