SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 17139 / September 19, 2001

   ACCOUNTING AND AUDITING ENFORCEMENT RELEASE NO. 1448

              SEC SETTLES FRAUD ACTION AGAINST CEC INDUSTRIES

   SECURITIES AND EXCHANGE COMMISSION v. C.E.C. INDUSTRIES CORPORATION,
   GERALD H. LEVINE, and MARIE A. LEVINE, Case No. 1 99CV02568 (D.D.C.)

   On September 10, 2001, the United States District Court for the
   District of Columbia permanently enjoined C.E.C. Industries
   Corporation from violating the anti-fraud and certain record-keeping
   and internal controls provisions of the federal securities laws.
   C.E.C. was further ordered by the Court to, within 90 days of the
   entry of the judgment, file amended quarterly and annual reports with
   the Commission restating the financial results for its fiscal years
   ended March 31, 1996 and March 31, 1997, and its fiscal quarters ended
   June 30, September 30, and December 31, 1997. C.E.C. also was enjoined
   from failing to file timely and accurate quarterly and annual reports
   in the future and ordered to file all of its delinquent quarterly and
   annual reports for its fiscal year ended March 31, 1998 and all
   subsequent periods.

   The Commission's complaint, filed September 28, 1999, alleged that
   C.E.C. fraudulently overstated its assets and revenues in public
   filings and other public statements during the company's fiscal years
   ended March 31, 1996 and March 31, 1997. According to the complaint,
   these material overstatements all resulted from various asset exchange
   transactions in which C.E.C. acquired non-cash assets in exchange for
   either company stock or other non-cash assets previously acquired with
   company stock. The complaint also alleges that C.E.C. has been
   chronically delinquent in filing required reports with the Commission
   since June 1997, and has not filed any required reports since July
   1998. The Commission contends that Gerald and Marie Levine, as
   C.E.C.'s controlling officers and directors during the relevant time
   period, were directly responsible for C.E.C.'s fraudulent
   overstatements of assets and revenues, as well as for C.E.C.'s filing
   delinquencies. According to the complaint, the Levines also published
   false and misleading information about C.E.C. on the Internet during
   the period in question.

   Without admitting or denying the charges against it, CEC consented to
   the entry of an injunction permanently enjoining it from violating
   Section 17(a) of the Securities Act of 1933, Sections 10(b), 13(a),
   13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934,
   and Exchange Act Rules 10b-5, 13a-1, 13a-13 and 12b-20. C.E.C. was