SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 17546 / June 6, 2002

ACCOUNTING AND AUDITING ENFORCEMENT RELEASE NO. 1570

JUDGMENT ENTERED AGAINST MADERA INTERNATIONAL, INC.

SEC v. Madera International, Inc., Ramiro M. Fernandez-Moris, and Daniel S. Lezak, 01 Civ. 1985 (JR) (D.D.C. filed Sept. 19, 2001)

The Securities and Exchange Commission today announced that, on June 4, 2002, the United States District Court for the District of Columbia entered a Final Judgment of Permanent Injunction By Default against Madera International, Inc. The judgment enjoins Madera from violating the antifraud, reporting, books and records, and internal controls provisions of the Securities Exchange Act of 1934 (Sections 10(b), 13(a) and 13(b)(2)(A) and (B), and Rules 10b-5, 12b-20, 13a-1, and 13a-13).

The court found that Madera, by its default, was deemed to have admitted the allegations in the Commission's complaint. The Commission's complaint alleged that Madera, a timber distributor, had engaged in fraudulent accounting and reporting practices since its inception in February 1994. Specifically, the complaint alleged that Madera recorded as assets various purported timber producing properties for which it lacked clear title, assigned and recorded arbitrary values for those timber producing properties, recorded revenues from phony sales transactions, failed to disclose significant related party transactions, and caused false sales invoices, shipping documents, cash receipts records and audit confirmations to be furnished to its independent auditors. Madera also issued false press releases concerning, among other things, the company's operations and profit forecasts.

For more information, see Litigation Release No. 17140 (September 19, 2001).