U.S. Securities and Exchange Commission

Litigation Release No. 18661 / April 7, 2004

SECURITIES AND EXCHANGE COMMISSION V. METROPOLIS HOLDINGS, LLC AND EDWARD GRAY, United States District Court for the Eastern District of California, Civil Action No. F 03-5538 AWI

Court Orders Attorney To Surrender Funds Obtained From Defendants In Fraud Scheme

United States District Judge Anthony Ishii ordered a Fresno, California attorney to return money advanced by two clients engaged in a fraudulent investment scheme. On March 30, 2004, the Court ordered Mario DiSalvo to pay $90,746.50 to the Clerk of the Court for eventual distribution to defrauded investors. The Court found that DiSalvo accepted $130,000 from Edward Gray and Metropolis Holdings, LLC during the course of an investment fraud. The Court rejected DiSalvo's claim that he earned all of the money as a "retainer" immediately upon receipt. After analyzing the work performed by DiSalvo, the Court concluded that DiSalvo had earned only a portion of the money by providing legal services. The Court held that DiSalvo was obliged to return the unearned fees to the Court, which has frozen the assets of Gray and Metropolis Holdings.