SECURITIES AND EXCHANGE COMMISSION
     Washington, D.C.

     LITIGATION RELEASE NO. 15597 / December 19, 1997

     SECURITIES AND EXCHANGE COMMISSION v. STEPHEN DESIMONE, FRANCIS DECABIA AND
     GARY MOODY, Civil Action No. 97-CIV-9359 (S.D.N.Y.)

     The Securities and Exchange Commission today filed a complaint in the
     United States District Court for the Southern District of New York against
     Stephen DeSimone, Francis DeCabia and Gary Moody.  The complaint alleges
     that from August through November 1992, DeSimone, a former registered
     representative at PaineWebber Inc. ( PaineWebber ), DeCabia, a former
     registered representative at Josephthal Lyon & Ross, Inc., now Josephthal &
     Co. ( Josephthal ), and Gary Moody, a self-described dealer in prime bank
     securities, engaged in a scheme to defraud the Nauru Phosphate Royalties
     Trust ( the Trust ) out of approximately $20 million for the purchase of
     prime bank securities.  The defendants never purchased any prime bank
     securities for the Trust because such securities do not exist.  DeSimone,
     DeCabia and Moody were each convicted of a felony in the state of New York
     as a result of their involvement in the scheme.

     The Commission s complaint alleges that the Trust exists for the benefit of
     the residents of the Republic of Nauru, a small island nation off the coast
     of Australia.  The complaint alleges that by mining and selling phosphate
     deposits, a chemical constituent of bird guano, the Trust amassed
     considerable funds, some of which the Trust invested with the defendants. 
     The complaint also alleges that through a series of fraudulent
     misrepresentations, DeCabia persuaded an agent of the Trust to deposit
     $20.75 million of the Trust s funds into an account at Josephthal for the
     purchase of prime bank securities.  DeCabia was the registered
     representative on that account.  According to the complaint, through a
     series of further misrepresentations, the defendants persuaded an agent of
     the Trust to transfer a total of $20.55 million from the Josephthal account
     to an account at PaineWebber in the name of Moody s alter-ego corporation. 
     DeSimone was the registered representative on that account.  The complaint
     alleges that without the knowledge or consent of the Trust, the defendants
     caused $19.75 million of the Trust s funds to be transferred from the
     account at PaineWebber to an account in Singapore.  The complaint also
     alleges that the defendants never purchased any securities on behalf of the
     Trust.  According to the complaint, with the assistance of various law
     enforcement and regulatory authorities, the Trust has recovered most of the
     money it invested with the defendants.  

     The Commission's complaint alleges that, based on the foregoing misconduct,
     DeSimone, DeCabia and Moody violated Section 17(a) of the Securities Act of
     1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-
     5 thereunder. The complaint seeks a permanent injunction restraining the
     defendants from committing further violations of these provisions of the
     federal securities laws.  

     The Commission would like to acknowledge the assistance of the Australian
     Securities Commission.