UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 Release No. 39902 / April 22, 1998 ACCOUNTING AND AUDITING ENFORCEMENT Release No. 1025 / April 22, 1998 ADMINISTRATIVE PROCEEDING File No. 3- 9581 ______________________________ :ORDER INSTITUTING PUBLIC:ADMINISTRATIVE PROCEEDING In the Matter of:PURSUANT TO RULE 102(e) OF :THE COMMISSION'S RULES OF Michael W. Crow, CPA:PRACTICE, MAKING FINDINGS AND :IMPOSING REMEDIAL SANCTION : Respondent.: ______________________________: I. The Securities and Exchange Commission (the "Commission") deems it appropriate that a public administrative proceeding be instituted pursuant to Rule 102(e)[1] of the Commission's Rules of Practice against Michael W. Crow ("Crow"). II. In anticipation of the institution of this administrative proceeding, Crow has submitted an Offer of Settlement ("Offer"), which the Commission has determined to accept. Solely for the purposes of this proceeding and any other proceeding brought by or on behalf of the Commission or in which the Commission is a party, and without admitting or denying the Commission's findings contained herein, except that he admits the jurisdiction of the Commission over him and over the subject matter of this proceeding and that a Judgment of Permanent Injunction and Other Relief has been entered against him, Crow consents the issuance of the Order Instituting Public Administrative Proceeding Pursuant to Rule 102(e) of the Commission's Rules of Practice, Making Findings and Imposing Remedial Sanction ("Order"). III. On the basis of this Order and of the Offer of Settlement of Crow, the Commission makes the following findings:[2] A.Crow, age 38, was President and Chairman of the Board of Wilshire Technologies, Inc. ("Wilshire") from November 1990 through March 1994 and a Wilshire Director from 1990 through September 1994. Crow is an inactive California certified public accountant ("CPA"). B.During fiscal years 1993 and 1994, Wilshire developed, manufactured and marketed medical, clean room and transdermal drug delivery products. During fiscal 1993, Wilshire introduced two new products, a transdermal appetite suppressant called "TrimPatch" and a clean room product known as the pipe plug. Wilshire's common stock is registered with the Commission pursuant to Section 12(g) of the Securities Exchange Act of 1934 ("Exchange Act") and is listed in the National Quotation Service Pink Sheets.[3] C.On November 1, 1996, the Commission filed a first amended complaint against Crow and another defendant in SEC v. Michael W. Crow, et al., Civil Action No. 96-1661 S (CGA) (the "First Amended Complaint"). On April 20, 1998, the United States District Court for the Southern District of California entered a Judgment of Permanent Injunction and Other Relief Against Defendant Michael W. Crow ("Judgment"), which, among other things: (1) permanently enjoins Crow from violating Section 17(a) of the Securities Act of 1933 ("Securities Act") and Sections 10(b), 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 10b-5, 12b-20, 13a-13, 13b2-1 and 13b2-2 thereunder; (2) orders Crow to disgorge the sum of $1,248,444, plus prejudgment interest of $225,773, with the judgment to be satisfied by the resolution of a related securities class action lawsuit; and (3) bars Crow from serving as an officer or director of any issuer having a class of securities registered pursuant to Section 12 of the Exchange Act or required to file reports pursuant to Section 15(d) of the Exchange Act. Crow consented to the entry of the Judgment without admitting or denying any of the allegations in the First Amended Complaint. D.The First Amended Complaint alleged, among other things, that from at least July 1993 through January 1994, Wilshire inflated its earnings in press releases and in periodic reports with the Commission. The Complaint further alleged that, contrary to Generally Accepted Accounting Principles, Wilshire inflated its earnings by improperly recognizing conditional sales, the sale of an asset to a related party, and a disputed claim against a supplier. The Complaint further alleged that Crow knew, or was reckless in not knowing, that Wilshire's financial statements were materially false and misleading and that Crow falsified, or caused to be falsified, accounting entries to Wilshire's books and records. In addition, the Complaint alleged that Crow omitted to state material facts to Wilshire's auditors in connection with the fiscal year 1993 audit of Wilshire's financial statements. The Complaint also alleged that Crow, while in possession of material non-public information concerning Wilshire's financial condition, sold Wilshire common stock in advance of Wilshire's disclosure of its true financial condition and, in so doing, avoided losses of nearly $1.2 million. IV. Based on the foregoing, the Commission deems it appropriate to accept the Offer of Settlement of Crow and accordingly, IT IS HEREBY ORDERED effective immediately, that Michael W. Crow is denied the privilege of appearing or practicing before the Commission as an accountant. By the Commission. Jonathan G. Katz Secretary **FOOTNOTES** [1]:Rule 102(e)(3)(i)(A) provides, in pertinent part, that "the Commission, with due regard to the public interest and without preliminary hearing, may, by order, ... suspend from appearing or practicing before it any ... accountant ... who has been by name permanently enjoined by any court of competent jurisdiction, by reason of his or her misconduct in an action brought by the Commission, from violating or aiding and abetting the violation of any provision of the Federal securities laws or of the rules and regulations thereunder." [2]:The findings herein are made pursuant to the Respondent's Offer of Settlement and are not binding on any other person or entity named as a respondent in these or any other proceedings. [3]:The Commission previously ordered Wilshire to cease and desist from committing or causing any violations and any future violations of Sections 10(b), 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 10b-5, 12b-20 and 13a-13 thereunder. In the Matter of Wilshire Technologies, Inc., Exchange Act Rel. No. 37719 (Sept. 24, 1996).