SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.

Litigation Release No. 17517 / May 14, 2002

   SECURITIES AND EXCHANGE COMMISSION v. LEWIS J. MCCONNELL, JR., NED L.
   HUGGINS, AND GREGORY T. WOOD, United States District Court for the
   District of Columbia, Civil Action No. 02 0075 RCL

   The Securities and Exchange Commission announced that on April 22,
   2002, the Honorable Royce C. Lamberth of the United States District
   Court for the District of Columbia, entered a Final Judgment of
   Permanent Injunction and imposed a civil penalty of $100,000 against
   Lewis J. McConnell, Jr. for engaging in a fraudulent offering of
   unregistered "prime bank note" securities. The Final Judgment, entered
   by default, enjoins McConnell from violating the antifraud and
   registration provisions of the federal securities laws (Sections 5(a),
   5(c) and 17(a) of the Securities Act of 1933, and Section 10(b) of the
   Securities Exchange Act of 1934 and Rule 10b-5 thereunder). Judge
   Lamberth also entered final judgments against Ned L. Huggins and
   Gregory T. Wood on February 11, 2002, enjoining Huggins and Wood from
   the same violations of the federal securities laws. Huggins and Wood
   consented to the entry of the final judgments without admitting or
   denying the allegations in the Commission's complaint.

   The Commission's complaint, filed on January 16, 2002, alleged that
   the defendants raised over $7 million from at least 21 investors by
   promoting their "Secure Private Placement Program," which purportedly
   generated risk-free returns of 20-25% per week. In materials
   distributed to investors, the Secure Private Placement Program was
   described as a joint venture between the investor and Gold Stream
   Holdings, Inc., in which the investor would participate in a program
   of trading certain "highly rated financial instruments." However,
   according to the complaint, the Secure Private Placement Program was
   merely a ploy by McConnell to, among other things, obtain financing
   for Gold Stream Holdings, which was a company through which he was
   conducting or trying to conduct his entertainment business. The
   complaint further alleged that McConnell hired Huggins and Wood to
   distribute certain materials to the investors, and that these
   materials contained numerous material misrepresentations and omissions
   concerning, among other things, the existence of such "highly rated
   financial instruments," Gold Stream Holdings' ability to participate
   in such a trading program, and the intended use of the investors'
   funds. All funds obtained by the defendants as a result of their
   illegal scheme have been returned to investors.

   This case is part of the SEC's continuing effort to combat prime bank
   fraud and to alert the public to the risks posed by these phony