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                SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 14918 / May 23, 1996

ACCOUNTING AND AUDITING ENFORCEMENT 
RELEASE NO. 785 / May 23, 1996

Securities and Exchange Commission v. Morris F. Baughman, Civil
No. 3-95-CV-1977-J (N.D. Texas) 

         The Securities and Exchange Commission announced that on
April 17, 1996 a final judgment of permanent injunction was
entered against Morris F. Baughman in Securities and Exchange
Commission v.  One Financial USA, Inc., Paul Coughlin, Marvin O.
Spain, William J. Rogers, Jr., and Morris F. Baughman, Civil No.
94-CV-01180 (WBB). This case was originally filed in the United
States District Court for the District of Columbia
(see Litigation Release No. 14106/Accounting and Auditing
Enforcement Release No. 565, issued May 31, 1994)
and subsequently transferred to the United States District Court
for the Northern District of Texas, Civil No. 3-95-CV-1977-J. 
One Financial USA, Inc. ( One Financial ) is a public company
registered with the Commission which is required to file with the
Commission periodic reports including financial statements and
other information.  In its Complaint in that case, the Commission
alleged that Baughman, who was the independent auditor for One
Financial, had conducted audits of the company's financial
statements for two time periods which failed to comply with
generally accepted auditing standards ( GAAS ).  The Complaint
further alleged that Baughman provided false certifications that
he had performed the audits in conformance with GAAS, which were
included in reports filed by One Financial with the Commission,
and also failed to take corrective action as required under GAAS
when he learned that the financial statements had also been
altered after his audits.

         The Honorable Mary Lou Robinson, United States District
Judge for the Northern District of Texas, entered a final
judgment which permanently enjoins Baughman from future
violations of the antifraud provisions of the federal securities
laws but does not impose civil monetary penalties against
Baughman based on his sworn representations to the Commission
concerning his financial condition.  Under the terms of the
final judgment, Baughman is enjoined from future violations of
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 promulgated thereunder.  In
settlement of this action, Baughman consented to the entry of the
final judgment without admitting or denying the allegations in
the Complaint and agreed to consent to a Commission order
pursuant to Commission ruel 102 (e) barring him from appearing or
practicing as an accountant before the Commission.





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         The Order entered in the administrative action denies
Baughman the privilege of appearing or practicing before the
Commission as an accountant, provided that five years after the
date of the Order, Baughman may apply to the Commission and
request that he be permitted to resume appearing or practicing
before the Commission.  The Order was based upon Baughman s offer
of settlement in which he consented, without admitting or denying
the Commission s findings, to the issuance of the Commission s
Order.

         In 1995, prior to the transfer of the case to the
Northern District of Texas, the Commission obtained
final judgments of permanent injunction against the other
defendants named in the federal district court
action.  On March 6, 1995, the Honorable William B. Bryant,
United States District Judge for the District of
Columbia, entered final judgments by default against One
Financial, Paul Coughlin, and Marvin O. Spain, after
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each of those defendants failed to answer the Commission s
Complaint.  On June 21, 1995, Judge Bryant entered
a final judgment by default against William J. Rogers, Jr. as a
sanction for Rogers  failure to provide discovery in the
litigation.  Under the terms of the final judgments, One
Financial, Coughlin, Spain, and Rogers each were enjoined from
future violations of the antifraud provisions of the federal
securities laws,
Section 17(a) of the Securities Act and Section 10(b) of the
Exchange Act and Rule 10b-5 thereunder.  One Financial was
further enjoined from future violations of the relevant reporting
provisions of the federal securities laws, Section 15(d) of the
Exchange Act and Rules 15d-1, 15d-11, 15d-13, and 12b-20
thereunder. In addition, One Financial, Coughlin, and Spain were
each ordered to pay $15,000 in civil penalties, and
Rogers was ordered to pay $10,000 in civil penalties, pursuant to
Section 20(a) of the Securities Act and
Section 21(d)(3) of the Exchange Act.