U.S. Securities and Exchange Commission


          Litigation Release No.  15672    /  March  17, 1998

          SECURITIES AND EXCHANGE COMMISSION V. INTERNATIONAL HERITAGE,
          INC., STANLEY H. VAN ETTEN, CLAUDE W. SAVAGE, LARRY G. SMITH and
          INTERNATIONAL HERITAGE INCORPORATED, a Nevada corporation, Civil
          Action File No. 1:98-CV-0803-TLS (N.D.Ga.)

               The Securities and Exchange Commission announced that on
          March 16, 1998, a temporary restraining order was entered by the
          United States District Court for the Northern District of Georgia
          against International Heritage Incorporated, a Nevada corporation
          ("Heritage Incorporated"), formerly known as Kara International
          Inc. ("Kara");  International Heritage, Inc. ("IHI"), a North
          Carolina corporation; Stanley H. Van Etten ("Van Etten"),
          founder, chairman of the board of directors, president and chief
          executive officer of IHI and chairman and CEO of Heritage
          Incorporated; Claude W. Savage ("Savage"), a founder and director
          of IHI and a director of Heritage Incorporated;  and Larry W.
          Smith ("Smith), a founder and director of IHI and a director of
          Heritage Incorporated. In addition, the Court appointed a
          receiver for IHI.

               The Commission's complaint, filed on March 16, alleges
          violations of the anti-fraud and registration provisions of the
          federal securities laws.  The complaint also alleges that
          Heritage Incorporated violated the reporting provisions by filing
          a misleading Form 8-K with the Commission.  The Commission is
          seeking permanent injunctions for violations of Sections 5(a),
          5(c) and 17(a) of the Securities Act and Section 10(b) of the
          Exchange Act and Rule 10b-5 thereunder, disgorgement of ill-
          gotten gains with prejudgment interest and  civil penalties
          against each defendant.

               The Commission's complaint alleges that, beginning in April
          1995, IHI through Van Etten, Savage, Smith and others, has been
          soliciting individuals throughout the United States to invest in
          a pyramid scheme.  IHI raised more than $150 million from over
          155,000 investors.  The complaint alleges that  interests in the
          program, which are described by IHI as business centers, are
          securities.  In addition to selling interests in the pyramid
          scheme, between July 17, 1997 and November 1, 1997, the
          defendants sold $5 million in notes convertible into shares of
          IHI common stock.  The defendants knowingly misrepresented IHI's
          financial condition to investors and concealed the fact that IHI
          was operating a pyramid scheme.

               Finally, on March 6, 1998, IHI consummated a reverse merger
          with Heritage Incorporated (formerly Kara), a publicly traded
          shell company.  The complaint alleges that Heritage Incorporated
          then filed a Form 8-K with the Commission which was misleading
          and concealed the fact that IHI was operating a pyramid scheme.
          On March 13, 1998, the Commission suspended trading in Heritage
          Inc. stock

               A hearing on the Commission's motion for preliminary
          injunction is scheduled for March 24, 1998.