UNITED STATES SECURITIES AND EXCHANGE COMMISSION


         Litigation Release No.   15933 / October 8, 1998

         SECURITIES AND EXCHANGE COMMISSION v. CITY SERVICES CORP.,
         et al., 98 Civ. 1867 (RPP), U.S.D.C., S.D.N.Y.

              The Securities and Exchange Commission ("Commission")
         announced that, on October 2, 1998, the United States
         District Court for the Southern District of New York entered
         a Final Judgment by Default Imposing Remedies against City
         Services Corp. ("City Services") and Joseph Burgio
         ("Burgio").  The order permanently enjoins and restrains
         City Services and Burgio from violating the antifraud
         provisions of the securities laws, in particular Section
         17(a) of the Securities Act of 1933 ("Securities Act") and
         Section 10(b) of the Securities Exchange Act of 1934
         ("Exchange Act") and Rule 10b-5 thereunder, and permanently
         restrains and enjoins Burgio from violating antifraud
         provisions applicable to broker-dealers, in particular
         Section 15(c)(1) of the Exchange Act and Rules 15c1-2 and
         15c1-5 thereunder, and from violating the broker-dealer
         registration provisions of Section 15(a)(1) of the Exchange
         Act.  The order also requires City Services and Burgio,
         jointly and severally, to disgorge $1,014,605 and $43,055 in
         prejudgment interest ($1,057,660 in total) and Burgio to pay
         $5,000 as a civil penalty.  The order arises from a
         complaint filed on March 16, 1998, in which the Commission
         alleged that City Services and Burgio fraudulently offered
         and sold City Services stock and that Burgio also was acting
         as an unregistered broker-dealer.

              The defendants are described in the Complaint as
         follows:

              JOSEPH BURGIO, age 29, is a resident of Brooklyn, New
              York.  He has held himself out to be the president,
              corporate secretary, and chairman of City Services'
              board of directors.  Between January and March 1, 1998,
              Burgio was associated as a registered representative
              with Three Arrows Capital Corp. ("Three Arrows"), a
              registered broker-dealer that employed Burgio in an
              office located in New York, New York. Burgio was not
              separately registered with the Commission.

              CITY SERVICES CORP. is a Delaware corporation.
              According to a private placement memorandum for the
              City Services stock offering it purports to have
              offices at 29 John Street, New York City.  That
              location is a mail drop only.  Since its inception in
              May 1997, City Services has not generated any revenue
              or engaged in any operations.  City Services stock is
              not publicly traded.

              The Complaint alleged as follows:

              Since at least January 1998, City Services and Burgio
              have fraudulently offered and sold City Services stock.
              City Services, Burgio and others working with them made
              telephonic "cold calls," and offered and sold the City
              Services stock to investors by means of a variety of
              false and misleading representations, including false
              claims that: (a) City Services would hold an initial
              public offering in the near future that would enable
              investors to more than double their money; (b) City
              Services was in the check cashing business; and (c) the
              funds raised in the offering would be held in escrow
              until the offering closed.  While soliciting investors,
              Burgio held himself out to be a registered
              representative of Three Arrows.  Burgio failed to
              disclose to at least some of the investors that he was
              also an officer of City Services.

              Burgio continued to solicit investors to purchase City
              Services after his association with Three Arrows
              terminated.  During the period he was associated with
              Three Arrows, he solicited investors without the
              authorization of Three Arrows.

              Burgio and City Services failed to answer, plead or
              otherwise respond to the Commission's Complaint.