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         UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934
Release No. 36847 / February 14, 1996

Administrative File No. 3-8950

ADMINISTRATIVE PROCEEDINGS INSTITUTED AGAINST JON EDELMAN

     The Commission instituted public administrative proceedings
pursuant to Sections 15(b) and 19(h) of the Securities Exchange
Act of 1934 ("Exchange Act") against Jon Edelman ("Edelman"). 
Edelman is a former principal of Arbitrage Management Company.

     The Order Instituting Public Proceedings alleges that
Edelman was convicted on February 4, 1991, in the United States
District Court for the Southern District of New York, of
violating 26 U.S.C.  7206(1) and (2), which make it a felony
to
file an income tax return that is verified as being made under
penalty of perjury, but which is known to be materially false,
and of violating 18 U.S.C.  371, which makes it a felony to
conspire to defraud the Internal Revenue Service.  Administrative
proceedings were originally instituted against Edelman on May 10,
1994.  However, actual service of the Order Instituting
Proceedings could not be effected on Edelman at that time. 
Accordingly, on October 12, 1994, the Commission entered an order
discontinuing, without prejudice, the administrative proceedings
against Edelman.  New proceedings against Edelman have now been
instituted.  

     A hearing will be scheduled to determine whether the
allegations are true and, if so, what, if any, remedial sanctions
are appropriate.
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