Professional Documents
Culture Documents
/V
~eetings will be held in the Commission Meeting Room on the eighth floor of the
Commission's headquarters building at 500 North Capitol street, Washington, D.C.
All visitors are required to sign in and obtain passes at the Reception Desk in the
lobby. Persons wishing to photograph or obtain a tape recording of Commission
meetings must obtain permission in advance from the Secretary of the Commission.
The subject matter of the April 17 closed meeting will be: Litigation matters;
Formal order of investigation; Settlement of administrative proceedings of an enforce
ment nature; Other litigation matters; Access to investigative files by Federal,
State, or Self-Regulatory authorities; Institution of administrative proceedings of
an enforcement nature~ Institution of injunctive actions; Freedom of Information Act
appeals.
CLOSED MEETING - WEDNESDAY, APRIL 18, 1979 - 10:00 A.M.
The subject matter of the April le closed meeting will be: Institution of administra
tive proceedings of an enforcement nature; Institution and settlement of administra
tive proceedings of an enforcement nature; Institution of injunctive actions; Other
litigation matter: Regulatory matter regarding financial institutions.
(7) Consideration of whether to issue a release under the Trust Indenture Act of
1939 announcing that issuers of debt securities in offerings exempt from registration
under Regulation A of the Securities Act of 1933 will not be required to qualify
indentures covering such securities under the Trust Indenture Act of 1939. FOR
FURTHER INFORMATION CONTACT Norman Schou at (202) 755-1240.
ADMINISTRATIVE PROCEEDINGS
ARNOLD & CO., INC. AND
RICHARD J. ARNOLD SANCTIONED
The Commission has revoked the broker-dealer registration of Arnold & Co., Inc.
(Registrant), a New Jersey broker-dealer for which a receiver was appointed on
October 19, 1978. However, Registrant shall continue to be deemed to be a registered
broker and dealer for the limited purpose of permitting the receiver, or any
successor to him, to engage in activities, pursuant to court order, necessary and
appropriate to the liquidation of Registrant.
The Commission also ordered that Richard J. Arnold (Arnold), Registrant's president,
treasurer and majority shareholder, be barred from being associated in any capacity
with any broker, dealer, investment company, investment adviser or municipal securi
ties dealer.
The above sanctions were based upon findings that: (1) Registrant and Arnold wil
fully violated Section lOeb) of the Securities Exchange Act of 1934 and Rule 10b-5
thereunder; and (2) on or about July 30, 1978, the U.S. District Court for the
District of New Jersey issued a final judgment of permanent injunction, pursuant to
the consents of Registrant and Arnold, entered without admitting or denying the
allegations in the Commission's complaint, enjoining Registrant from further viola
tions of, and Arnold from aiding and abetting further violations of, Sections 15(c) (3)
and l7(a) of the Exchange Act and Rules 15c3-1, 17a-3 and 17a-ll thereunder.
By authority of the District Court, the receiver submitted an offer of settlement
by which he waived any objection to which he may be entitled to the above findings
and sanctions with respect to Registrant, without admitting or denying the allega
tions in the Order for Proceedings.
The sancti~n~ imposed were ba~e~ upon findings that Registrant violated certain anti
fra~d prov~s~ons of the ~ecur~~~es laws by engaging in a series of transactions
des~g~ed to ~reate the.m~s17ad~ng appearance of having satisfied a condition of the
of~er~ng o~ ~nterests ~~ ~n~ghtsbridge Realty Partners, Ltd.-75 (Knightsbridge-75)
wh~ch requ~red that a m~n~mum number of interests be sold prior to the disbursement
of any proceeds from such sales to the issuer or others. The Commission also found
that both respondents violated Regulation T by arranging for the extension and
maintenance of credit, without collateral, by banks to and for customers of
Re~istrant, which credit was used by the customers to purchase interests in Knights
br~dge-75. ~t.was also found ~hat Borenstein violated the registration provisions
of.the se~ur~t~es.Ac~ of 1933 ~n the 1974 public offering and sale of interests in
Kn~ghtsbr~dge Ill~no~~ Real Estate Partners, Ltd. Finally, Registrant and Borenstein
w re f~und tO,have fa~led r7ason~bly ~o supervise persons subject to their supervi
7
s~on w~th a v~ew to prevent~ng v~olat~ons of the securities laws. (ReI. 34-15678)
COMMISSION ANNOUNCEMENTS
SEC STAFF REPORT ON TRANSACTIONS IN THE
MARINE PROTEIN CORPORATION INDUSTRIAL DEVELOPMENT REVENUE BONDS
The Commission's Report concludes that the process by which industrial development
revenue bonds are brought to the market place depends upon many persons, including
the issuer, underwriter, fiscal agents, bond counsel, company executives and regis
tered representatives. The antifraud provisions of the securities laws, while not
imposing a structured form of disclosure as required for the offering of non-exempt
securities pursuant to the Securities Act of 1933, do prohibit the deception of
investors in connection with the offering of exempt securities. In prepa~ing and
disseminating the bond offering prospectus, the bond underwriter failed to include
the material information referred to above, and Marine failed to accept or assume
any responsibility to insure that information being disseminated by bond under
writers in connection with the bond offering was complete and not false and mis
leading.
The Commission has decided to release this Report in the public interest pursuant
to Section 2l(a) of the Securities Exchange Act of 1934. This is not to be construed
as an adjudicative determination. Nor is the investigation or this Report a
determination of the rights or liabilities of any person.
CII_AL PROCEEDINGS
FORMER FRANKLIN NEW YORK DIRECTORS INDICTED
The New York Regional Office announced the return of a 99 count indictment on March 19
against Michele Sindona and Carlo Bordoni, former directors of Franklin New York
Corporation (FNYC), the holding company for Franklin National Bank (FNB). The
indictment charges both defendants with one count of conspiracy, numerous counts of
wire mail and stock frauds, misapplication of FNB funds, the making of false entries
in the books, records and statements of FNB and FNYC, and submission of false state
ments to Manufacturers Hanover Trust Company to obtain a loan. In addition, Sindona
was charged with one count of perjury for testifying falsely before the Commission
in 1974. (U.S. v. Michele Sindona and Carlo Bordoni, 5 75 Cr. 948, S.D.N.Y.).
(LR-8716)
3
NEWS DIGEST, April 12, 1979
JAMES H. DONDICH AND LOUIS M. MAYO, JR. CONVICTED
The San Francisco Branch Office announced that on April 3, after a six week trial,
a federal jury in San Francisco convicted James H. Dondich of Santa Ana, California
of one count of conspiracy, one count of transportation fraud and nine counts of
securities fraud. In addition, Louis M. Mayo, Jr. was convicted on one count of
conspiracy and eight counts of securities fraud. Dondich and Mayo were convicted
for their fraudulent offers and sales of securities issued by Reclamation District
No. 2090, a public agency located in Contra Costa County, California. Co-defendants
Max H. Mortenson, Roger W. Osness and Roy J. Jackson were simultaneously acquitted
of conspiracy and securities fraud charges. (U.S. v. James Harold Dondich, et al.,
CR-78-202-CBR; N.D. CaL). (LR-8717)
CIVIL PROCEEDINGS
INJUNCTION ENTERED AGAINST FEDERAL'S, INC.
The Chicago Regional Office announced that on March 21, the federal court at
Washington, D.C. granted the Commission's motion for summary judgment and permanently
enjoined Federal's, Inc., a Michigan corporation headquartered in Detroit, Michigan,
from violations of the reporting provisions of the Securities Exchange Act of 1934.
The court also directed that a delinquent annual and quarterly report pertaining to
Federal's be filed with the Commission no later than April 30, 1979. The court
declined to enter a permanent injunction personally against Steven Watstein, also
known as Steven West, formerly Chairman of the Board and Chief Executive Officer
of Federal's, and granted the defendant's motion for summary judgment in this
regard. (SEC v. Federal's, Inc. and Steven Watstein, U.S.D.C. D.C., Civil Action No.
78-1760) • (LR-8718)
A notice has been issued giving interested persons until April 30 to request a hear
ing on an application of Life Insurance Company of North America (LINA), a Pennsyl
vania stock life insurance company, and Life Insurance Company of North America
Separate Account A, a separate account of LINA registered under the Investment Company
Act of 1940 as a unit investment trust, for an order pursuant to Section 11 of the
Act approving certain offers of exchange and pursuant to Section 6(c) of the Act for
exemptions from Sections 27(a) (4), 22(e), 27(c) (1), and 27(d) of the Act.
(ReI. IC-I0658 - Apr. 11)
A notice has been issued giving interested persons until May 3 to request a hearing
on a proposal of General Public Utilities Corporation (GPU), a registered holding
company, that GPU increase its short-term debt authorization from $71 million to
$150 million. (ReI. 35-21003 - Apr. 10)
WEST TEXAS UTILITIES COMPANY
A notice has been issued g~v~ng interested persons until May 3 to request a hearing
on a proposal of West Texas Utilities Company (WTU), subsidiary of Central and South
West Corporation, that WTU issue and sell $25 million in first mortgage bonds at
competitive bidding, and to make changes by a Supplemental Indenture. (ReI.'
35-21004 - Apr. 10)
4
NEWS DIGEST, April 12, 1979
MISCELLANEOUS
EDWARDS & ANGELL
An order has been issued pursuant to Section 3(a) (2) of the Securities Act of 1933
7xempti~g from th7 reg~stration r7quirements of the Act interests or participations
~ssued ~n connect~on w~th the Ret~rement Plan for Legal and Certain Other Personnel
of Edwards & Angell, a law firm organized as a partnership under Rhode Island law
(Rel. 33-6053) •
(S-8) FIRST ALABAMA BANCSHARES, INC., First Alabama Plaza, P.O. Box 1448, Montgomery,
Ala. 36102 (205) 832-8450 - 60,000 shares of common stock. (File 2-63964 - Apr. 2)
(S-8) XEROX CORPORATION, Stamford, Conn. 06904 (716) 423-9200 - $9,920,150 of participa
tions and 169,575 shares of common stock. (File 2-64012 - Apr. 5)
(S-l) COMMODITY TREND TIMING FUND, 1 Western Union International Plaza, New York, N.Y.
10004 - 10,000 units of limited partnership interest. Underwriter: Shearson Hayden
Stone Inc. (File 2-64067 - Apr. 10)
(S-8) THE ALLEN GROUP INC., 534 Broad Hollow Rd., Melville, N.Y. 11747 (516) 293-5500
10,000 participations and 348,715 shares of common stock. (File 2-64073 - Apr. 11)
(S-7) UNITED GAS PIPE LINE COMPANY, 700 Milam St., Houston, Tex. 77002 (713) 237-4123
$50 million of debentures, due May 1, 1989. Underwriter: Merrill Lynch White Weld
Capital Markets Group. The company is enqaged in the purchase, gathering, trans
portation and sale of natural gas. (File 2-64074 - Apr. 11)
(S-7) THE DOW CHEMICAL COMPANY, 2030 Dow Center, Midland, Mich. 48640 (517) 636-1000
25,000 shares of common stock. (File 2-64075 - Apr. 11)
(S-8) BRUSH WELLMAN INC., 17876 St. Clair Ave., Cleveland, Ohio 44110 - 150,000 shares
of common stock. (File 2-64080 - Apr. 11)
(8-16) PHILIP MORRIS INCORPORATED, 100 Park Ave., New York, N.Y. 10017 (212) 679-1800
130,494 shares of common stock. (File 2-64081 - Apr. 11)
(5-8) 5PS TECHNOLOGIES, INC., Jenkintown, Pa. 19046 (215) 884-7300 - 250,000 shares of
common stock. (File 2-64082 - Apr. 11)
(S-l) TRI-AMERICAN CORPORATION, 1101 Euclid Ave., Cleveland, Ohio 44115 - 3,250 units
of sinking fund debentures, due 1994 and 170,62? shares ~f.common stock. under~
writer: The Ohio company. The company engages ~n the wr1t1ng of non-standard r1sk
automobile insurance policies. (File 2-64083 - Apr. 11)
(S-11) KLH PROPERTIES LIMITED PARTNERSHIP, One Liberty Plaza, 165 Broadway, New York,
N.Y. 10080 - 15,000 units of limited partnership interests. (File 2-64086 - Apr. 11)
(S-1) LAND RESOURCES CORPORATION, 1125 N.E. 125th St., North Miami, Fla. 33161 (305)
895-6500 - 326,776 shares of common stock. The company is engaged in the acquisition
and sale of undeveloped and developed real estate. (File 2-64087 - Apr. 11)
In a separate statement the company seeks registration of 140,500 shares of common
stock. (File 2-64088 - Apr. 11)
(5-8) SCHLUMBERGER LIMITED, 277 Park Ave., New York, N.Y. 10017 (212) 350-9458 -
4,500,000 shares of common stock. (File 2-64089 - Apr. 12)
(5-16). CHARTER NEW YORK CORPORATION, One Wall St., New York, N.Y. 10005 (212) 487-6338 -
$75 million of floating rate notes, due 2004. Underwriters: Salomon Brothers and
Merrill Lynch White Weld Capital Markets Group. (File 2-64090 - Apr. 12)
(S-1) PAL0 PINTO 1979-80 DRILLING PROGRAMS, 2800 Highway 277 South, Abilene, Tex. 79606 -
2,500 units of preformation subscriptions in limited partnership, (File 2-64091 -
Apr. 12)
-ACQUISITIONS OF SECURITIES
Companies and individuals must report to the Commission within.10 days on Schedule
13D if after the acquisition of equity securities of a public company their beneficial
interest therein exceeds 5%. Persons eligible to use the short form (Form 13-G) may
in lieu of filing a Schedule 13D file a Form 13-G within forty-five days after the end
of the calendar year in which the person became subject to Section.l3(d) (1). The
following companies or individuals filed Schedule 13D's during the period
March 12, 1979 . The number of shares of the security which are beneficially
owned, and the number of shares concerning which there is a right to acquire are sent
forth for each beneficial owner. *Amended Acquisition Reports.
RZPORTTNG COMPANY
OR INDIVIDUAL ISSUER & NUMBER OF SHARES DATE FILED
Walter Kidde & Co, Inc. Ennis Business Forms, Inc. (Ennis, TX) 3-12-79
Common Stock - 75,700 shs.
J. Hale McKethan Florida Mining & Materials Corp. (Tampa, FL) 3-12-79
Individually & Trustee Common Stock - 83,162 shs.
(Included above are shares owned by his wife.)
Thomas E. Bronson Florida Mining & Materials Corp. (Tampa, FL) 3-12-79
Sarah Alice Bronson Common Stock - 112,989 shs.
* Fabian 1974 Irrevocable For Better Living, Inc. (Laguna, Niguel, CAl 3-12-79
Trust Common Stock - 334,038 shs. (37.9%)
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NEWS DIGEST, April 12, 1979
SECURITIES
UNITED STATES
AND EXCHANGE COMMISSION
WASHINGTON, o. C. 20"49