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         UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 14796 / January 25, 1996

SECURITIES AND EXCHANGE COMMISSION v. JOSEPH M. AARON, CHARTWELL
FINANCIAL, ET AL., United States District Court for the Northern
District of California, Civil Action No. 96-0101 EFL.

     The Securities and Exchange Commission announced that it
filed a Complaint in the United States District Court for the
Northern District of California against Joseph M. Aaron,
Chartwell Financial and others on January 8, 1996.  On January
17, 1996, the Court entered a final judgment of permanent
injunction against Aaron and Chartwell.

     The Commission's Complaint alleged that from October 1990
through October 1992, Aaron and Chartwell raised approximately
$16 million by selling investment trust notes through 12 broker-
dealers to approximately 400 investors.  While offering and
selling the promissory notes issued by the trusts, Aaron and
Chartwell made at least two significant misrepresentations and
omissions of material facts.  First, Chartwell stated in the
offering memoranda that it would carefully monitor the use of
investors' funds by the asset based lenders ("ABLs") that
received the funds and the status of payments on the loans made
by the ABLs to corporate borrowers.  In fact, Chartwell
recklessly failed to monitor use of funds as represented in the
offering memoranda.  Second, Chartwell stated that ABLs were
required to "co-participate" in the accounts receivable
transactions by advancing their own funds to cover 20% of the
total funds loaned to corporate borrowers.  Chartwell recklessly
failed to ensure that the ABLs advanced their own funds, and, in
fact, the ABLs failed to advance their own funds in violation of
the 20% co-participation requirement.

     Aaron consented, without admitting or denying the 
allegations of the Complaint, to the entry of an order: (1)
enjoining him from future violations of Section 17(a) of the
Securities Act of 1933 and Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 thereunder; (2) imposing a
civil penalty of $20,000 against Aaron; and (3) appointing a
Special Agent to receive and distribute any funds paid to the
trusts or Chartwell as creditors in the ABLs' bankruptcy
proceedings.