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U.S. Securities and Exchange Commission

Before the

Release No. 1976 / September 28, 2001

File No. 3-10593

In the Matter of






The Securities and Exchange Commission ("Commission") deems it appropriate in the public interest that public administrative proceedings be, and hereby are, instituted against James S. Saltzman ("Saltzman") pursuant to Section 203(f) of the Investment Advisers Act of 1940 ("Advisers Act").

In anticipation of the institution of these proceedings, Saltzman has submitted an Offer of Settlement ("Offer"), which the Commission has determined to accept. Solely for the purpose of this proceeding and any other proceedings brought by or on behalf of the Commission or in which the Commission is a party, and without admitting or denying the findings contained herein, except for jurisdiction and those findings set forth below in Section II., paragraph B., which are admitted, Saltzman, by his Offer, consents to the entry of the findings and imposition of sanctions contained in this Order Instituting Public Proceedings, Making Findings and Imposing Remedial Sanctions ("Order").

Accordingly, IT IS ORDERED that proceedings against Saltzman be, and hereby are, instituted.


On the basis of this Order and the Offer submitted by Saltzman, the Commission finds that:

A. James S. Saltzman, age 56, resides in Ambler, Pennsylvania. From at least October 1996 through June 2000, Saltzman was the chairman of the board, assistant secretary, and treasurer of Madison Monroe, Inc., an investment adviser registered with the Commission pursuant to Section 203(h) of the Advisers Act from April 1997 through April 1998 and May 1999 through January 2001, when the entity withdrew its registration. Saltzman also was the managing general partner and a limited partner of Saltzman Partners, L.P. ("Saltzman Partners"), a Pennsylvania limited partnership, from at least 1982 through May 9, 2000. As the managing general partner of Saltzman Partners, Saltzman maintained exclusive control over Saltzman Partners' investment portfolio, bank accounts, and brokerage accounts and received compensation for his services based on the investment portfolio's performance.

B. On September 19, 2001, a Final Judgment and Order was entered against Saltzman by the United States District Court for the Eastern District of Pennsylvania, in Securities and Exchange Commission v. James S. Saltzman, Civil Action No. 00-2468. The Final Judgment and Order permanently enjoined Saltzman from future violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 and Section 206(2) of the Advisers Act, and ordered him to pay disgorgement plus prejudgment interest in the amount of $1,920,340, and a civil penalty in the amount of $50,000. Saltzman consented to the Final Judgment without admitting or denying the allegations in the Commission's complaint, except for allegations that relate solely to charges that are not the subject of the Final Judgment and Order.

C. The Commission's Complaint alleged that from at least 1994 through February 4, 2000, Saltzman, as investment adviser to Saltzman Partners, violated the securities laws at issue by failing to disclose material information relating to loans to him by Saltzman Partners in annual financial statements of Saltzman Partners that were sent to the limited partners, namely, that he had taken out approximately $1.78 million in loans from Saltzman Partners, that by 1999 the loans amounted to approximately 20% of Saltzman Partners' assets, and that the loans violated specific terms of the loan provisions in the governing Partnership Agreement and Private Placement Memorandum. Prior to the entry of the Final Judgment and Order, Saltzman fully repaid with interest the loans he had taken from Saltzman Partners, thus satisfying the Order of disgorgement by the District Court.


On the basis of the foregoing, the Commission deems it appropriate and in the public interest to accept the Offer submitted by Saltzman and to impose the sanctions specified therein.

Accordingly, IT IS HEREBY ORDERED, that Saltzman be, and hereby is, suspended from association with any investment adviser for a period of twelve months, effective on the second Monday after the entry of this Order.

By the Commission.

Jonathan G. Katz


Modified: 10/01/2001