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         UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 14970 / July 3, 1996

Securities and Exchange Commission v. James G. Freeman, et al.,
(United States District Court for the Northern District of
California, Civil Action No. C-96-2316-WHO).

     The Securities and Exchange Commission announced that on
June 25, 1996, a Complaint was filed in the U.S. District Court
for the Northern District of California against James G. Freeman
(Freeman) and 20 companies he controlled seeking an order of
permanent injunction, disgorgement and civil penalties based on
violations of Sections 5(a), 5(c), 17(a)(1), 17(a)(2) and
17(a)(3) of the Securities Act of 1933 and Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder.

     The Commission's Complaint alleges that, among other things,
during the period from approximately April 1994 through April
1995, Freeman operated a nation-wide "Ponzi" scheme involving
nearly 500 investors and raising over $26 million in proceeds. 
As a part of this scheme, Freeman misappropriated approximately
$4.45 million from investors.  During the one-year period,
Freeman and the companies offered and sold promissory notes
("Freeman notes").  The investor funds raised through the sale of
the Freeman notes allegedly were to be invested in various
European ventures.  The Freeman notes were renewable every 9
months and guaranteed a 12% annual return.  In addition,
investors were promised a "longevity bonus" equal to 8% interest
on all funds maintained in the alleged investment for each year
the Freeman note was renewed.  In reality, however, Freeman was
operating nothing more than a Ponzi Scheme.  Freeman deposited
all investor funds into bank accounts under his control and used
the proceeds to make purported interest payments, pay exorbitant
commissions, satisfy unrelated business and personal expenses and
meet obligations to prior investors.

     Accordingly, in connection with the offer, purchase and sale
of securities, Freeman and the companies he controlled made
misrepresentations and omissions of material fact concerning the
nature of the investments, the legitimacy of the investments, the
use of investor proceeds, the returns to be generated, the
commissions to be paid, and the risks involved.