FOR IMMEDIATE RELEASE                                    2000-135

     SEC Brings Fraud Charges in Internet Manipulation Scheme

     Settlement Calls for Return of $285,000 in Illegal Gains

     Washington, DC, September 20, 2000 - The Securities and
Exchange Commission today brought and settled civil fraud charges
against Jonathan G. Lebed, age 15, for using the Internet to
conduct a stock manipulation scheme that made total profits of
$272,826.  Without admitting or denying the findings, Mr. Lebed
settled with the Commission, agreeing to an administrative cease
and desist order and to disgorge his illegal profits of $272,826,
together with prejudgment interest of $12,174, for a total of
$285,000.  This is the first time the Commission has brought
charges against a minor.

     Ronald C. Long, Administrator of the Philadelphia District
Office said, "I implore investors to be highly skeptical of any
advice they receive from the Internet.  People should do thorough
research before making investment decisions and verify all
information before acting on it."

     The Commission's Order finds that, on eleven separate
occasions between August 23, 1999 (when Lebed was 14 years old)
and February 4, 2000, Lebed, of Cedar Grove, New Jersey, engaged
in a scheme on the Internet in which he purchased, through
brokerage accounts, a large block of a thinly-traded microcap
stock.  Within hours of making the purchase, Lebed sent numerous
false and/or misleading unsolicited e-mail messages, or "spam,"
primarily to various Yahoo! Finance message boards, touting the
stock he had just purchased.  Lebed then sold all of these shares,
usually within 24 hours, profiting from the increase in price his
messages had caused.  In some instances, Lebed placed a sell limit
order before the market closed on the day he purchased the stock
to ensure that he would not miss the price increase of the stock
while he was in school the next day.  Lebed's profits on each
trade ranged from more than $11,000 to nearly $74,000.

     The Order finds that Lebed used multiple fictitious author
names for the hundreds of identical messages he posted during each
manipulation.  The postings Lebed made to Internet website message
boards included baseless price predictions and other false and/or
misleading statements.  For example, he claimed in one of his
messages that a company trading at $2 per share would be trading
at more than $20 per share "very soon."  Other postings claimed
that a stock would be the "next stock to gain 1,000%," and was
"the most undervalued stock ever."  The posted messages always
caused the price and volume of the touted stocks to increase
dramatically.  On the day that Lebed sold his shares, and realized
his profit, the trading volume in the stock reached either record
or near-record highs, in some cases reaching a 52-week high for
both volume and price.

Contacts:
Ronald C. Long, District Administrator, Philadelphia District
Office, 215-597-3106
David S. Horowitz, Assistant District Administrator, Philadelphia
District Office, 215-597-2950

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