SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C.

Litigation Release No. 14861 / April 3, 1996

SECURITIES AND EXCHANGE COMMISSION v. FREDERICK AUGUSTUS MORAN,
ET AL., Civil Action No. 95-4472 (S.D.N.Y. April 2, 1996)

     On April 2, 1996, Judge Bernard Newman, sitting by
designation in the United States District Court for the Southern
District of New York, issued an Opinion and Order dismissing
insider trading claims against all defendants and finding that
defendants Frederick A. Moran Sr. (Moran Sr.) and Moran Asset
Management Inc. (MAM) breached their fiduciary duty and defrauded
their clients in violation of Section 206(2) of the Advisers Act.

The Court also found that Moran Sr. and MAM wilfully violated the
disclosure requirements of Sections 204 and 207 of the Advisers
Act and Rule 204-1(b)(1) thereunder and that Moran Sr. and
defendant Moran & Associates Inc. Securities Brokerage (MSB)
violated the registration requirements of Section 15(b) of the
Exchange Act and Rule 15b3-1 thereunder.  

      Moran Jr. was a telecommunications analyst at Salomon
Brothers who worked on the Bell Atlantic/TCI/Liberty
Communications transaction.  Moran Sr. purchased 340,799 TCI
Class A common shares and 203,200 Liberty Class A shares for
managed, personal and family accounts on the last two days before
the public announcement of the transaction.  The Commission
alleged that Moran Jr. had tipped his father about the
transaction and that Moran Sr. made the purchases while in
possession of material non-public information.  The Court found
the Commission had not sustained its burden of proof as to that
contention, although, according to the Court, "[s]urely one
possible inference that can reasonably be drawn from the evidence
presented in this case is that Moran Sr. purchased cable security
stocks based on material nonpublic information provided to him by
Moran Jr.  But "this inference, however, is not the most likely
scenario suggested by the proof."  And the Court further states:
"the evidence in this case, while not showing an intent on the
part of Moran Jr. to violate the law in order to assist his
father, nonetheless illustrates Moran Jr.'s willingness to
provide information to his father, even if doing so is contrary
to the established policies of Salomon Brothers or the wishes of
his firm's clients."  While the Court found that the Commission
failed to establish a tip prior to Moran Sr.'s trades,  the Court
found that "the merger details relayed by Moran Jr. on the
evening of October 12 were still confidential non-public
information"  but not actionable because Moran Sr. had completed
his trades before then.    

     With respect to the Commission's other claims, the Court
found that Moran Sr. and MAM negligently allocated shares of
telecommunications stocks purchased in advance of the announce-
ment of the Bell Atlantic/TCI/Liberty Communications merger to
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his personal, family, and firm accounts while allocating to their
investment advisory clients shares of those securities purchased
at higher prices, in violation of Section 206(2) of the Advisers
Act. The Court also found that Moran Sr., MAM and MSB failed to
disclose that Moran Sr.'s sons Frederick W. Moran Jr. (Moran Jr.)
and Clayton Moran were directors of MAM and MSB.  Judge Newman
found "Moran Sr. acted with knowledge and intended to conceal
that his sons were directors.  Certainly this is an indication
that he was acting surreptitiously .... the fact that the sons
were still omitted even though the form was supposedly corrected,
leads to the unmistakable conclusion that the omissions were
intentional."  Accordingly, Moran Sr. and MAM violated Sections
204 of the Advisers Act and Rule 204-1(b)(1), which require the
prompt amendment of an investment adviser's registration
statement if it becomes inaccurate, and Section 207 of the
Adviser's Act, which prohibits investment advisers from making
willful material misstatements or omissions in registrations
filed with the Commission.  Moran Sr. and MSB violated Section
15(b) of the Exchange Act and Rule 15b3-1 because they failed to
amend their inaccurate broker dealer registration.

     Judge Newman directed the parties to contact the Court
within thirty days to establish a date for a hearing on the
penalty portion of this trial.  The action was commenced on June
15, 1995 (see Litigation Release No. 14532) and was tried before
the Court in December 1995.