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         UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Litigation Release No. 14838 / March 7, 1996

Securities & Exchange Commission v. Thomas F. Lanier
(Middle District of North Carolina, Civil Action No. 95-367

     The Securities and Exchange Commission announced that on
March 4, 1996, a federal jury sitting in the United States
District Court for the Middle District of North Carolina
convicted Thomas F. Lanier on a five-count criminal indictment
alleging insider trading violations in connection with
transactions in the stock of Salem Carpet Mills, Inc.  (United
States v. Thomas F. Lanier, 95CR317-1).  The criminal charges
included securities fraud and money laundering.  Salem Carpet
Mills, Inc., is a former North Carolina-based, publicly traded
carpet manufacturer.    

     The indictment alleged that in January 1992, Thomas Lanier,
while then Salem's chief financial officer and a director,
improperly disclosed to William Clarke Lindley, his Burlington,
N.C. neighbor, material, non-public information relating to
Salem's confidential merger negotiations with Shaw Industries. 
This information included the identity of Shaw Industries as
Salem's potential merger partner and the general timing of the
merger.  Salem and Shaw Industries announced a merger on February
10, 1992.  The indictment alleged that Lindley and Lanier had
agreed for Lindley to pay Lanier 35% of his trading profits from
the inside information.  The indictment further alleged that
Lanier and Lindley met on February 11, 1992, to divide the
illegal trading profits according to their agreement, and that
Lindley paid Lanier $27,500.

     The Commission previously announced the filing of a civil
action on May 24, 1995 (Litigation Release No. 14507 ) based on
the same set of facts.  That matter is still in litigation.