INVESTMENT ADVISERS ACT OF 1940
Release No. 1881 / June 20, 2000

SECURITIES EXCHANGE ACT OF 1934
Release No. 42963 / June 20, 2000

ADMINISTRATIVE PROCEEDING
File No. 3-10236

In the Matter of

JAMES L. FOSTER, LAURIE F. FOSTER,
STEVEN M. BOLLA, AND WILLIAM E.
BUSACKER, JR.,
Respondents.

ORDER INSTITUTING PROCEEDINGS,
MAKING FINDINGS AND IMPOSING
REMEDIAL SANCTIONS

I.

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that proceedings be, and hereby are, instituted pursuant to Section 203(f) of the Investment Advisers Act of 1940 ("Advisers Act") against James L. Foster ("James Foster") and Steven M. Bolla ("Bolla"), and pursuant to Section 203(f) of the Advisers Act and Section 15(b)(6) of the Securities Exchange Act of 1934 ("Exchange Act") against Laurie F. Foster ("Laurie Foster"), and William E. Busacker, Jr. ("Busacker") (collectively, the "Respondents").

II.

In anticipation of these proceedings, the Respondents have submitted Offers of Settlement ("Offers") 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 in which the Commission is a party, without admitting or denying the findings contained herein, except the Commission's findings set forth in Paragraphs III. A. through III. E., which are admitted, the Respondents have consented to the issuance of this Order Instituting Public Proceedings, Making Findings and Imposing Remedial Sanctions ("Order"), and to the entry of the findings and the imposition of the remedial sanctions set forth below.

III.

On the basis of this Order and the Respondents' Offers, the Commission finds that:

A. James L. Foster, age 56, resides in Franklin, Massachusetts. At all relevant times, he was portfolio manager, president, CEO, and one of two principal shareholders of Trustcap Financial Group, Inc. ("Trustcap"), a holding company. James Foster also served as vice president of Security Financial, Inc. ("SFI") and of Matrix Investment Advisors, Inc. ("Matrix"), both of which were registered with the Commission as investment advisers.

B. Laurie F. Foster, age 43, is James Foster's wife and also resides in Franklin, Massachusetts. She is the other principal shareholder of Trustcap. At all relevant times, Laurie Foster served as vice president of Trustcap, secretary of SFI, vice president and secretary of Matrix, and president and secretary of Matrix Capital Management, Inc. ("MCM"). At all relevant times, she was also a registered representative of Securities Service Network, Corporate Securities Group, and Trustcap Securities Group, all of which were broker-dealers. Matrix, SFI and MCM were at all relevant times wholly-owned subsidiaries of Trustcap.

C. Steven M. Bolla, age 41, resides in Centreville, Virginia, and at all relevant times, was president of SFI. At all relevant times, Bolla was a 17 percent shareholder of Trustcap and served as its vice president of marketing and sales.

D. William E. Busacker, Jr., age 41, resides in Schenectady, New York. At all relevant times, he was president of Matrix, a 10 percent shareholder of Trustcap, sole shareholder and president of a broker-dealer called Trustcap Securities Group, and a registered representative of a broker-dealer called Securities Service Network.

E. On June 19, 2000, a final judgment was entered against James Foster, Laurie Foster, Bolla and Busacker in Securities & Exchange Commission v. James L. Foster, et al. (United States District Court for the District of Columbia), Civil Action No. 00CV01192. The Respondents were permanently restrained and enjoined from directly or indirectly violating: Sections 204 and 206 (1), (2), and (4) of the Advisers Act and Rules 204-2(a)(3), (c)(1) and (c)(2), and 206(4)-2(a)(1) through (5) thereunder; Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 ("Securities Act"); and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. In addition, the Respondents James Foster, Laurie Foster and Bolla were permanently restrained and enjoined from directly or indirectly violating Section 206(4) of the Advisers Act and Rule 206(4)-1(a)(5) thereunder. Each of the Respondents consented to entry of the final judgment without admitting or denying any violations of the federal securities laws, or any of the allegations set forth in the Commission's Complaint, except as to the subject matter and in personam jurisdiction.

F. The Commission's Complaint alleged, inter alia, that between early 1995 and October 1996, the Respondents James Foster, Laurie Foster, Bolla and Busacker, directly or indirectly, defrauded Matrix and SFI advisory clients by: (1) misrepresenting the investment strategy of Matrix and SFI as conservative when, in reality, they engaged in a high-risk strategy, inconsistent with the clients' stated investment objectives, and/or changed from a conservative investment strategy to a high-risk strategy inconsistent with the clients' stated investment objectives without disclosing this change to the clients; (2) mailing fraudulent account statements to clients; (3) failing to disclose that James Foster fraudulently allocated securities in a way that resulted in certain clients being favored over others; (4) failing to disclose that Laurie Foster and Busacker received commissions for trades placed on behalf of Matrix and SFI client accounts; and (5) taking custody of client funds without establishing and maintaining the required safeguards. The Complaint further alleged, inter alia, that between early 1995 and October 1996, the Respondents James Foster, Laurie Foster, and Bolla defrauded SFI advisory clients by: publishing, circulating and distributing false and misleading marketing materials; publishing, circulating and distributing advertisements containing untrue statements of material facts; and diverting and misappropriating client funds.

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions that are set forth in the Offers submitted by the Respondents.

Accordingly, IT IS HEREBY ORDERED that:

A. James Foster is barred from association with any investment adviser;

B. Laurie Foster is barred from association with any investment adviser and any broker- dealer, with the right to reapply for association after three years from the date of entry of this Order to the appropriate self-regulatory organization, or if there is none, to the Commission;

C. Bolla is barred from association with any investment adviser, with the right to reapply for association after five years from the date of entry of this Order to the Commission;

D. Busacker is suspended from association with any investment adviser and any broker- dealer for a period of twelve (12) months, effective on the second Monday following the entry of this Order; and

E. Busacker shall comply with the undertakings in his Offer of Settlement to file with the Division of Enforcement of the Commission, at the conclusion of the twelve-month suspension ordered, an affidavit in a form satisfactory to the Division of Enforcement demonstrating that he has complied fully with the sanctions set forth herein.

By the Commission.

Jonathan G. Katz
Secretary