UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 15356 / May 1, 1997          

SECURITIES AND EXCHANGE COMMISSION V. DOUGLAS R. DAMON ET AL.,
(N.D. ILL., CIVIL ACTION NO. 95 C 7569, FILED DECEMBER 22, 1995)

The Securities and Exchange Commission today announced that on
April 15, 1997 the United States District Court for the Northern
District of Illinois, in Chicago, entered a Final Judgment and
Order of Permanent Injunction (Order) against Douglas R. Damon
(Damon), Robert M. Davis (Davis) and Kenneth C. Kolovitz
(Kolovitz).  The Order enjoins Damon, Davis and Kolovitz from
future violations of the registration and antifraud provisions of
the federal securities laws.  Damon, Davis and Kolovitz each
consented to the entry of the Order without admitting or denying
the allegations in the Commission's Complaint.

The Commission's Complaint, filed on December 22, 1995, alleged
that Damon, Davis and Kolovitz made misrepresentations and
omissions to investors in order to sell $6.6 million worth of
unregistered securities in the form of promissory notes, in
violation of Sections 5(a), 5(c) and 17(a) of the Securities Act
of 1933 and Sections 10(b), 15(a)(1) and 15(c)(1) of the
Securities Exchange Act of 1934 and Rules 10b-5 and 15c1-2
thereunder.  Specifically, the Complaint alleged that, from 1989
through October 1990, Union Credit Corporation (UCC) issued the
promissory notes, which Damon, who controlled UCC, and Davis and
Kolovitz, who acted as salesmen for UCC, sold to investors.  The
notes were not registered as securities with the Commission.  The
Complaint further alleged that Damon, Davis and Kolovitz made
numerous misrepresentations and omissions to investors in the
sale of these notes, including that UCC would use investor funds
to purchase business machines, UCC would lease those machines to
various businesses, and investors would receive a return of their
principal and between 24% and 31% interest on that principal
amount, which was to be derived from the proceeds of the business
machine leases.  In fact, the Complaint alleged, Damon operated a
ponzi scheme, and did not purchase business machines with
investor monies.  Rather, it alleged that he used investor funds
to pay other investors, and for his personal purposes.