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         UNITED STATES SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 15154 / November 7, 1996

SECURITIES AND EXCHANGE COMMISSION v. ROBERT C. COWAN, et al.,
5:96-CV-0224-C, USDC, ND/TX (Lubbock Division)

     The Securities and Exchange Commission ("Commission")
announced the filing of a complaint on November 5, 1996, in
United States District Court, Lubbock, Texas, against Robert C.
Cowan ("Cowan"), individually, and doing business as CS
Investments Trust ("CSI"), and Cowan Asset Management, Inc.,
("CAMI"), an investment adviser registered with the Commission,
seeking emergency relief under the federal securities laws. The
Commission's complaint alleges that Cowan, individually and doing
business as CSI, violated 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, that CAMI violated Sections 206(1),
(2), and (4) of the Investment Advisers Act of 1940, and Rule
206(4)-2 thereunder, and that Cowan aided and abetted CAMI's
violations. 

     The Honorable Sam R. Cummings, United States District Judge,
granted the Commission's request for a temporary restraining
order prohibiting Cowan, CSI and CAMI from violating the
antifraud provisions of the federal securities laws, and freezing
the assets of Cowan, CSI and CAMI. The Court also set November
15, 1996, as the date for an evidentiary hearing on the
Commission's motion for a preliminary injunction, and ordered
that the defendants file a sworn accounting of their financial
condition with the Court prior to that date.

      According to the complaint, Cowan raised at least $1
million, and as much as $3 million, from his customers for the
purpose of purchasing trust units in CSI, which he represented to
be an independent investment company registered with the
Commission. Further, Cowan allegedly told customers that he would
pool these funds with monies obtained from other investors and
purchase a portfolio of safe, high-yielding debt instruments, and
that CSI would pay an above-market, fixed rate of return for a
one-year period, and provide investors with the option to roll-
over investments at a newly calculated, above-market fixed rate.
In fact, according to the complaint, CSI does not exist, apart
from Cowan's misrepresentations and created records, and does not
hold securities or funds for customers; rather, Cowan used
customers' funds for his personal expenses, and to satisfy
periodic payments and redemptions for his customers as part of a
"ponzi" scheme. 

     The complaint also seeks disgorgement from Cowan, CSI, and
CAMI of all illegal gains as a result of the violative conduct
alleged in the Commission's complaint, and civil money penalties.
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