SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.

LITIGATION RELEASE NO. 17584 / June 25, 2002.

SECURITIES AND EXCHANGE COMMISSION v. SHARP CAPITAL, INC., ET AL. Civil Action No. 3:98-CV2792-G [USDC/NDTX/Dallas Division]

DALLAS LAW FIRM AGREES TO PAY $1.2 MILLION FOR VIOLATING COURT ORDER IN SEC ENFORCEMENT ACTION

The Securities and Exchange Commission announced today that the Dallas law firm, Gardere Wynne Sewell LLP, has agreed to pay $1.2 million for violating a court order in a pending SEC civil lawsuit against Sharp Capital Advisors, Inc., one of the law firm's former clients. For 18 months, Gardere failed to produce 27 boxes of Sharp's records in its possession that the court had ordered produced. The $1.2 million being paid will be used to compensate investors who lost money in the scheme underlying the SEC's suit.

Sharp is a former registered investment adviser that catered to Mexican and other Latin American investors. The SEC lawsuit against Sharp alleged that the company and its principal, Mauricio Gutierrez, lost as much as $80 million of client funds in highly leveraged investments in speculative securities of Eastern European and South American companies without client knowledge or authorization.

In November 1998, the SEC obtained emergency orders from the U.S. District Court for the Northern District of Texas freezing the assets of Sharp and Gutierrez and appointing a Special Master to collect and maintain the assets for the benefit of Sharp's advisory clients. The orders directed Sharp, Gutierrez, and their agents immediately to provide to the Special Master all non-privileged books, records and documents relating to Sharp's activities and cooperate with the Special Master by promptly and honestly responding to all requests for information.

Sharp and Gutierrez agreed to the court orders. As their attorney, Gardere represented Sharp and Gutierrez and negotiated the terms and language of the orders on their behalf. But Gardere failed to turn over to the Special Master 27 boxes of Sharp's records until 18 months after the entry of the orders. The boxes contained relevant documents not previously produced to the Special Master.

As a result of Gardere's failure to timely deliver these records, the Special Master's efforts to administer the assets maintained for investors was significantly impaired. The SEC and Special Master believe that the $1.2 million being paid is appropriate compensation for the damages caused by Gardere's failure to comply with the court orders. Gardere's agreement to settle the claims of the SEC and Special Master for this amount is subject to court approval.

Previously in the Sharp litigation, the Special Master recovered more than $17 million, much of which already has been distributed to victims of the scheme. In addition, Gutierrez has pled guilty to criminal fraud charges brought by a federal grand jury in conjunction with the U.S. Attorney's Office for the Northern District of Texas and is awaiting sentencing. For further information about the Sharp litigation, see SEC Litigation Release No. 16946.