UNITED STATES SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 17233 / November 15, 2001

   The U.S. Securities and Exchange Commission ("Commission") announced
   today that Judge Sidney A. Fitzwater, United States District Judge for
   the Northern District of Texas, entered a Final Judgment of Permanent
   Injunction and Other Equitable Relief against Defendant John C.
   Matthews. The underlying action was originally filed on September 2,
   1999. In it, Judge Fitzwater granted the Commission's request for an
   emergency asset freeze, the appointment of a Receiver, and other
   equitable relief to halt a fraudulent "prime bank" investment scheme.
   The Commission's Complaint charged that from April 1998 through August
   1998, Kay L. Cahill, a convicted felon, Matthews and other defendants
   violated 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, when they raised approximately $9.5 million from investors
   nationwide for a purported "trading program" in foreign bank
   instruments promising returns of as much as 1,000%. In reality, the
   trading program did not exist and investor funds were used to make
   "Ponzi" payments, in that funds from later investors were used to pay
   purported profits to earlier investors. In addition, investor funds
   were misappropriated for certain defendants' personal use. For
   example, Cahill purchased an 11,000-square-foot house in Tyler, Texas,
   at a cost of approximately $1.2 million, and spent investor funds for
   moving and travel expenses, and to purchase furniture and automobiles.

   As part of the final judgment against Matthews, Judge Fitzwater
   permanently enjoined Matthews from future violations of the antifraud
   provisions of the federal securities laws and ordered him to pay
   disgorgement of $2,745,000, representing his gains from the conduct
   alleged in the Commission's Complaint, and prejudgment interest of
   $202,216. The Commission waived payment of the disgorgement and
   prejudgment interest, except for funds already provided to the
   Receiver and the funds to be generated by the Receiver's sale of
   Matthews' assets, including his house and automobile, and did not seek
   the imposition of a civil penalty, based upon Matthews demonstrated
   financial inability to pay. According to the Commission's Complaint,
   Matthews, age 48, is a resident of El Paso, Texas. He participated in
   the underlying fraud through his father's insurance company, Sunland
   States Insurance Agency, by providing bogus insurance policies
   purportedly guaranteeing investments in Cahill's trading program.
   Matthews received substantial funds from investors as insurance
   premiums, but failed to obtain the promised policies.
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Modified 11/16/2001