==========================================START OF PAGE 1======

         UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 15136 \ October 25, 1996

U.S. v. Joseph Polichemi, Lyle Edward "Pete" Neal, Oscar William
Olson, John Joseph DeVincens, Charles R. Padilla, Larry P.
Oesterman and Edward W. Russey, N.D. Ill., No. 94 CR 555.

     The Commission and the U.S. Attorney's Office for the
Northern District of Illinois announced that on October 22, 1996,
the Honorable William T. Hart of the United States District Court
for the Northern District of Illinois sentenced Joseph Polichemi
(Polichemi), Lyle Neal (Neal), Oscar William Olson, Jr. (Olson),
and Charles Padilla (Padilla) for their criminal convictions
arising from their involvement in multiple fraudulent schemes
involving purported "Prime Bank Instruments."  These schemes
included the Chicago Housing Authority's (CHA) $14 million
investment in the Konex Roll Program, the subject of an action
previously brought by the Commission against Polichemi, Neal,
Olson and others for violations of 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.

Specifically, Polichemi was sentenced to serve 210 months for
convictions on one count of conspiracy, eight counts of money
laundering and fifteen counts of wire fraud.  Neal was sentenced
to serve 235 months for convictions on one count of conspiracy,
five counts of money laundering, thirteen counts of wire fraud
and three counts of perjury.  Padilla was sentenced to serve 78
months for thirteen counts of wire fraud and three counts of
perjury.  Finally, Olson was sentenced to serve 121 months for
convictions on three counts of money laundering.  These
defendants also were ordered to pay, on a joint and several
basis, restitution to investors in the amount of $10 million.
The perjury convictions against Neal and Padilla resulted from
their sworn testimony in connection with Commission's
investigation concerning the Konex Roll Program.  Larry Oesterman
(Oesterman) and Edward Russey (Russey) earlier plead guilty to
charges relating to the fraudulent schemes.  Oesterman was
sentenced to serve 46 months and Russey was sentenced to nine
months home detention.  In a separate criminal action, John Lauer
(Lauer), CHA's Director of Risk Management and Benefits, plead
guilty to wire fraud, mail fraud and obstruction of justice
charges.  To date, Lauer has not been sentenced.

     The criminal charges relating to the Konex Roll Program