UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES ACT OF 1933 Release No. 7576 / September 9, 1998 SECURITIES EXCHANGE ACT OF 1934 Release No. 40417 / September 9, 1998 ADMINISTRATIVE PROCEEDING File No. 3-9698 ________________________________ : ORDER INSTITUTING A PUBLIC In the Matter of : ADMINISTRATIVE AND CEASE-AND- : DESIST PROCEEDING, PURSUANT TO GILBERT MINTZ : SECTION 8A OF THE SECURITIES and PEARLE G. MINTZ, : ACT OF 1933 AND SECTIONS 15(b), : 19(h) and 21C OF THE SECURITIES : EXCHANGE ACT OF 1934, MAKING Respondents. : FINDINGS, AND IMPOSING _______________________________ : SANCTIONS AND CEASE-AND-DESIST ORDER I. The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that a public administrative and cease-and-desist proceeding pursuant to Section 8A of the Securities Act of 1933 ("Securities Act") and Sections 15(b), 19(h) and 21C of the Securities Exchange Act of 1934 ("Exchange Act"), be instituted against Gilbert Mintz ("G. Mintz") and Pearle G. Mintz ("P. Mintz") (collectively referred to as the "Respondents"). II. In anticipation of the institution of this proceeding, the Respondents have each submitted an Offer of Settlement ("Offer"), which the Commission has determined to accept. Solely for the purpose of this proceeding and any other proceeding brought by or on behalf of the Commission or to which the Commission is a party, and without admitting or denying the findings contained herein, except that the Respondents admit the jurisdiction of the Commission over them and the subject matter of this proceeding, the Respondents by their Offers of Settlement consent to the entry of this Order Instituting a Public Administrative and Cease-and-Desist Proceeding, Making Findings and Imposing Sanctions and Cease-and-Desist Order ("Order"), and to the entry of the findings, sanctions and cease-and-desist order set forth below. Accordingly, IT IS ORDERED that a proceeding pursuant to Section 8A of the Securities Act of 1933 and Sections 15(b), 19(h) and 21C of the Securities Exchange Act of 1934 against the Respondents be, and hereby is, instituted. III. On the basis of this Order, and the Offers of Settlement submitted by the Respondents, the Commission finds that:[1] Since 1993, Gilbert Mintz and Pearle G. Mintz (the "Respondents") have held Series 7, 22 and 24 securities licenses. Since November 1995, Respondents have been associated with a registered broker-dealer. From about December 1993 through October 1994, Respondents offered and sold for the account of others shares of Empower Telecommunications Corporation ("Empower"), a Delaware corporation. Respondents sold approximately $2.2 million in Empower shares to over 100 investors. There was neither a registration statement on file or in effect relating to Respondents' offers and sales of Empower securities. Neither Respondent was registered as a broker or dealer, nor associated with a registered broker or dealer, when they offered or sold the Empower securities. In connection with these sales, the Respondents represented, both orally and in writing, that they would not receive any sales commissions. In fact, the Respondents each received $7,500 in sales commissions. The Respondents willfully violated Sections 5(a) and 5(c) of the Securities Act by, directly or indirectly, making use of any means or instruments of transportation or communication in interstate commerce or of the mails to sell or to offer to sell or offer to buy securities, or to carry or to cause to be carried through the mails or in interstate commerce any such security, for the purpose of sale or delivery after sale without a registration statement on file or in effect or an exemption from registration, as is more particularly stated in Paragraphs III.B. through E. above. The Respondents willfully violated Section 17(a) of the Securities Act by, directly or indirectly, in the offer or sale of any security by the means and instruments of transportation or communication in interstate commerce or by use of the mails: (1) employing devices, schemes, or artifices to defraud; (2) obtaining money or property by means of untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or (3) engaging in any transaction, practice, or course of business which operated as a fraud or deceit upon purchasers of securities, as is more particularly stated in Paragraphs III.B. through F. above. The Respondents willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails: (1) employing a device, scheme, or artifice to defraud; (2) making an untrue statement of a material fact or omitting to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or (3) engaging in an act, practice, or course of business which operates or would operate as a fraud or deceit upon any person, in connection with the purchase or sale of any security, as is more particularly stated in Paragraphs III.B. through F. above. The Respondents willfully violated Section 15(a) of the Exchange Act by making use of the mails or means or instrumentalities of interstate commerce to effect transactions in, or to induce or attempt to induce the purchase or sale of any security without being registered as broker-dealers or associated with a registered broker-dealer, in accordance with Section 15(b) of the Exchange Act, as is more particularly stated in Paragraphs III.B. through E. above. IV. The Respondents have submitted an Offer of Settlement in which, without admitting or denying the findings herein, they consent to the Commission's entry of this Order, which: (1) makes findings, as more particularly stated above; (2) orders Respondents to cease and desist from committing or causing any violation and any future violation of Sections 5(a), 5(c) and 17(a) of the Securities Act and Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5, thereunder; (3) orders each Respondent to pay $7,500 in disgorgement and a $7,500 civil penalty; and (4) bars each Respondent from associating with any broker, dealer, investment company, investment adviser or municipal securities dealer, with the right to reapply for association after three years. V. In view of the foregoing, the Commission deems it appropriate and in the public interest to accept the Respondents' Offers of Settlement. Accordingly, IT IS HEREBY ORDERED that: Pursuant to Section 8A of the Securities Act and Section 21C of the Exchange Act, the Respondents shall cease and desist from committing or causing any violation and any future violation of Sections 5(a), 5(c) and 17(a) of the Securities Act and Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder; Pursuant to Section 21B of the Exchange Act, G. Mintz shall pay a $7,500 civil penalty, and P. Mintz shall pay a $7,500 civil penalty. Each of the Respondents shall pay the civil penalty within 60 days of the date of the Order. Such payments shall be: (1) made by United States postal money order, certified check, bank cashier's check, or bank money order; (2) made payable to the Securities and Exchange Commission; (3) hand-delivered or mailed to the Comptroller, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Stop 0-3, Alexandria, VA 22312; and (4) submitted under cover letter that identifies the Respondents, the file number of these proceedings, a copy of which cover letter and money order or check shall be sent to Gregory C. Glynn, Trial Counsel, Securities and Exchange Commission, 5670 Wilshire Boulevard, 11th Floor, Los Angeles, CA 90036; Pursuant to Section 8A of the Securities Act and Section 21C of the Exchange Act, G. Mintz shall pay $7,500 in disgorgement, and P. Mintz shall pay $7,500 in disgorgement. Each of the Respondents shall pay the disgorgement within 60 days of the date of the Order. Such payments shall be: (1) made by United States postal money order, certified check, bank cashier's check, or bank money order; (2) made payable to the Securities and Exchange Commission; (3) hand-delivered or mailed to the Comptroller, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Stop 0-3, Alexandria, VA 22312; and (4) submitted under cover letter that identifies the Respondents, the file number of these proceedings, a copy of which cover letter and money order or check shall be sent to Gregory C. Glynn, Trial Counsel, Securities and Exchange Commission, 5670 Wilshire Boulevard, 11th Floor, Los Angeles, CA 90036; and Pursuant to Section 15(b) of the Exchange Act, Respondents are barred from associating with any broker, dealer, investment company, investment adviser or municipal securities dealer, with the right to reapply for association after three (3) years to the appropriate self-regulatory organization, or if there is none, to the Commission. By the Commission. Jonathan G. Katz Secretary **FOOTNOTES** [1]:/The findings herein are made pursuant to G. Mintz's and P. Mintz's Offers of Settlement and are not binding on any other person or entity named as a respondent in this or any other proceeding.