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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 16159 \ May 24, 1999

COURT PERMANENTLY ENJOINS AND FINES INVESTMENT
ADVISER THAT OBSTRUCTED SEC EXAMINATION

SEC v. The Barr Financial Group, Inc. and Alfred E. Barr, No. 98-1806-CIV-T-17E (M.D. Fla.) (Kovachevich, J.)

The Securities and Exchange Commission ("SEC") announced that on Wednesday, May 5, 1999, the Honorable Elizabeth A. Kovachevich of the United States District Court for the Middle District of Florida entered a final judgment of permanent injunction and other relief against The Barr Financial Group, Inc. ("BFG"), a Tampa investment adviser, and its principal Alfred E. Barr ("Barr"). The Court ruled that BFG, aided and abetted by Barr, violated Section 204 of the Investment Advisers Act of 1940 ("Advisers Act") by "willfully refusing to allow the SEC to examine BFG’s books and records and to produce to the SEC copies of certain legally required documents." The SEC’s action resulted from Barr’s refusal, during a 1998 examination of BFG, to reveal to the SEC information regarding the identity of BFG’s clients that it is required to disclose under the Advisers Act. In its decision, the Court recognized that the SEC’s examination authority is "central to the SEC’s execution of its congressionally-mandated regulatory duties."

The final judgment enjoins BFG and Barr from further violations of Section 204 of the Advisers Act and Rule 204-2 thereunder. The Court also imposed a civil money penalty against Barr in the amount of $5,000.


Modified:05/24/1999