UNITED STATES OF AMERICA
                           Before the 
               SECURITIES AND EXCHANGE COMMISSION 


SECURITIES ACT OF 1933
Release No. 7278 / April 9, 1996

SECURITIES EXCHANGE ACT OF 1934
Release No. 37084 / April 9, 1996

INVESTMENT ADVISERS ACT OF 1940
Release No. 1560 / April 9, 1996

ADMINISTRATIVE PROCEEDING
File No. 3-8983

______________________________
                              : 
In the Matter of              :
                              :         ORDER INSTITUTING
                              :         PUBLIC ADMINISTRATIVE
                              :         PROCEEDINGS, MAKING
GRUNTAL & CO., INCORPORATED,  :         FINDINGS, IMPOSING
                              :         REMEDIAL SANCTIONS, AND
                              :         ISSUING CEASE AND
                              :         DESIST ORDER
     Respondent.              :
______________________________:


                                I.

     The Securities and Exchange Commission ("Commission") deems
it appropriate and in the public interest that public
administrative proceedings be instituted against Gruntal & Co.,
Incorporated ("Gruntal") pursuant to Section 8A of the Securities
Act of 1933 ("Securities Act"), Sections 15(b)(4) and 21C of the
Securities Exchange Act of 1934 ("Exchange Act") and Sections
203(e) and 203(k) of the Investment Advisers Act of 1940
("Advisers Act").  In anticipation of the institution of these
administrative proceedings, Gruntal has submitted an Offer of
Settlement, which the Commission has determined to accept. 
Solely for the purpose of these proceedings and any other
proceeding brought by or on behalf of the Commission, or to which
the Commission is a party, Gruntal, by its Offer of Settlement,
prior to a hearing pursuant to the Commission's Rules of Practice
and without admitting or denying the findings set forth herein,
consents to the entry of this Order Instituting Public
Administrative Proceedings, Making Findings, Imposing Remedial
Sanctions, and Issuing Cease and Desist Order ("Order").
==========================================START OF PAGE 2======

                               II.

     Accordingly, IT IS HEREBY ORDERED that proceedings pursuant
to Section 8A of the Securities Act, Sections 15(b)(4) and 21C of
the Exchange Act, and Sections 203(e) and 203(k) of the Advisers
Act be, and hereby are, instituted.

                               III.

     The Commission makes the following findings:-[1]- 

Respondent

     A.   At all times from January 1, 1993 to the present,
Gruntal has been a broker-dealer registered with the Commission
pursuant to Section 15(b) of the Exchange Act and has been an
investment adviser registered with the Commission pursuant to
Section 203(c) of the Advisers Act.  Throughout that period,
Gruntal has been a member of several national securities
exchanges, including the New York Stock Exchange, Inc. ("NYSE"),
and of the National Association of Securities Dealers, Inc.  As a
broker-dealer, Gruntal provides a full range of securities
brokerage and trading services, as well as related financial
services.  As an investment adviser, Gruntal manages client
accounts or advises on the selection and monitoring of other
investment managers.  According to Gruntal's Form ADV filed on
September 29, 1994, Gruntal advised 325 clients with assets of
$164 million.   

Summary

     B.   This proceeding involves violations of the antifraud
and record-keeping provisions of the federal securities laws in
connection with Gruntal's execution of brokerage transactions for
investment advisory clients and other customers.  Between January
1993 and November 1995, Gruntal, through its three investment
advisory divisions, executed at least 8,813 transactions for its
advisory clients on a principal basis or by crossing advisory
client orders with orders for other Gruntal customers.  These
transactions were contrary to the disclosure in Gruntal's Form
ADV and in many instances violated the notice and consent
requirements of the Advisers Act.  In addition, confirmations
sent to advisory clients and other Gruntal brokerage clients
wrongly identified certain principal transactions as agency
transactions.  Gruntal also charged commissions, commission
equivalents or mark-ups/mark-downs (collectively, "transaction

---------FOOTNOTES----------
     -[1]-     The findings  herein and  the entry of  this Order
               are solely for the purposes of this proceeding and
               shall not be binding on any other person or entity
               named in any other proceeding.
==========================================START OF PAGE 3======

charges") on transactions for certain advisory clients who had
chosen to pay only an asset-based fee to Gruntal for brokerage
and execution services ("fee-only clients"), contrary to
statements in Gruntal's Form ADV and brochures provided to
clients.  From March 1995 to November 1995, Gruntal also failed
to disclose to its advisory clients that it received payment for
directing order flow to two affiliated broker-dealers.  Finally,
Gruntal failed to keep and maintain accurate records concerning
the capacity in which it executed transactions.
 
     Gruntal's Investment Advisory Divisions

     C.   At all times from January 1993 to the present, Gruntal
has provided investment advisory services through three
divisions:  Managed Accounts, Sterling Advisors and Professional
Asset Management ("PAM").

     D.   Managed Accounts and Sterling provide investment
advisory services on both a discretionary and non-discretionary
basis.  Clients are offered a choice of fee arrangements
including (1) an all-inclusive fee based on a percentage of total
assets under management or (2) a management fee based on a
percentage of total assets under management and a separate
payment for custody and execution services.

     E.   PAM provides various services including establishing
investment guidelines and objectives, selecting appropriate
investment managers and monitoring investment performance.  PAM
does not have any discretionary authority over its clients'
accounts but rather recommends non-affiliated investment
advisers.  PAM's clients pay their investment advisers
separately.  PAM's clients may direct that all transactions for
their accounts be executed through Gruntal and have two
alternatives for compensating Gruntal: (1) an all-inclusive fee
based on a percentage of total assets under management; or (2)
Gruntal's standard commission schedule.

     F.   At all relevant times, Gruntal's Form ADV has stated
that the all-inclusive fee for Sterling includes "advisory
services, trade execution and settlement, custodial fees, and
accounting services. . . ."  Gruntal distributed brochures to
Sterling and Managed Accounts clients which state that the all-
inclusive fee for Managed Accounts and Sterling covers "both
investment advisory services and custody (Gruntal only) and
execution services with no separate charged [sic] imposed for
brokerage commissions on agency trades or markups or markdowns on
principal transactions, except mutual fund purchases and
syndicate issues, if any."  

     G.   At all relevant times, Gruntal's Form ADV has stated
with respect to PAM that "the client may pay a pre-determined,
asset based commission that covers all trading related charges
==========================================START OF PAGE 4======

for the account (with the exception of certain minor NYSE
charges) no matter what the trading activity."  Gruntal
distributed brochures to PAM clients which state that PAM's
asset-based commission covers "PAM consulting services and all
custody (Gruntal only) and execution services with no separate
charge imposed for brokerage commissions on agency trades or
markups or markdowns on principal transactions, except mutual
fund purchases and syndicate issues, if any."

     H.   On September 27, 1994, Gruntal filed the Sterling,
Managed Accounts, and PAM brochures with the Commission, as
Schedule H to Gruntal's Form ADV.  

     The 1992 Examination and Related Representations by Gruntal

     I.   An examination of Gruntal's investment advisory
activities conducted by the Commission's staff in late 1992
revealed various deficiencies.  As the staff advised Gruntal in a
deficiency letter dated January 29, 1993, among other things: (1)
Gruntal had failed to comply with the notice and consent
requirements of Section 206(3) of the Advisers Act with respect
to principal and agency cross transactions; (2) Gruntal's Form
ADV, which stated that Gruntal generally did not effect principal
transactions with its advisory clients and would, in substance,
comply with the notice and consent requirements of the Advisers
Act in the event that Gruntal did effect such transactions, was
inaccurate in that Gruntal had in fact executed transactions on a
principal basis with its advisory clients without complying with
such requirements; (3) Gruntal's Form ADV failed to disclose that
Gruntal effected agency cross transactions with its advisory
clients; and (4) Gruntal had improperly imposed transaction
charges on certain trades for its fee-only clients' accounts.

     J.   In response to the staff's deficiency letter, Gruntal
informed the staff in writing that Gruntal was amending its Form
ADV and that it was creating a special order ticket to be used
when effecting transactions for advisory clients' accounts.  The
special order ticket was to carry a notice stating:  "Agency
Transaction - Do not Cross" to prevent principal and agency cross
transactions from being effected.   

     K.   Gruntal filed an amended Form ADV on March 30, 1993
which stated, in pertinent part:

     Gruntal & Co. does not permit principal or cross
     transactions with investment advisory clients.  A
     special order ticket is utilized for advisory clients
     which states "Agency Transaction - Do not Cross" to
     ensure compliance with the above.  In addition,
     managers of those areas review all transactions daily
     to ensure that orders are entered and executed
     properly. 
==========================================START OF PAGE 5======

     The Principal and Agency Cross Transactions

     L.   From January 1993 through November 1995 (the "relevant
period"), Gruntal executed at least 8,792 purchases and sales of
securities for advisory clients on a principal basis and at least
21 transactions on an agency cross basis.  Gruntal did not
disclose to the clients (including clients of Managed Accounts
and Sterling whose accounts were managed by Gruntal) in writing,
prior to the completion of each such transaction, the capacity in
which Gruntal was acting in the transaction and did not obtain
client consent thereto.  

     M.   On certain of the principal trades, as well as for
certain principal trades involving non-advisory brokerage
customers, Gruntal wrongly stated in customer confirmations that
it had acted as agent in the transaction when, in fact, Gruntal
had acted as principal.

     N.   Contrary to its representations to the staff and in its
Form ADV, Gruntal never used the new order tickets when effecting
transactions for its advisory clients' accounts and did not
adequately review all transactions daily to ensure that orders
for advisory clients' accounts were executed properly.  
  
     O.   In certain of the principal transactions, clients were
disadvantaged in that Gruntal caused them to pay transaction
charges greater than the amount of commission the client (other
than a fee-only advisory client) would have been charged had the
transaction been executed on an agency basis.  

     P.   Certain of the transactions referred to above were
executed other than on a national securities exchange. 

     The Transaction Charges on Certain 
     Trades For Fee-Only Clients        

     Q.   During the relevant period, Gruntal imposed transaction
charges on certain trades for advisory clients who had chosen to
pay Gruntal an all-inclusive, asset-based fee.  In many of these
transactions, Gruntal did not disclose such transaction charges
in customer confirmations.  Imposing the transaction charges was
contrary to the representations in Gruntal's Form ADV and the
brochures provided to clients.

     Payment for Order Flow

     R.   From March 1995 through November 1995, Gruntal effected
additional purchases and sales of securities for advisory clients
through two registered broker-dealers which are 99.9% owned by a
limited liability company in which Gruntal owns an interest
exceeding ten percent.  Gruntal received payment for directing
trades to these broker-dealers.
==========================================START OF PAGE 6======

     S.   Item 13 of Part II of Form ADV requires an adviser to
describe additional compensation it receives from non-clients in
connection with giving advice to clients.  Gruntal did not
disclose Gruntal's financial interest in the affiliated broker-
dealers, or Gruntal's  receipt of payments for order flow in its
Form ADV. 

     Failure to Maintain Accurate Books and Records

     T.   Gruntal's customer confirmations and other records in
some instances wrongly stated that brokerage transactions had
been executed on an agency basis when they were in fact executed
on a principal basis.  Gruntal therefore failed to maintain an
accurate memorandum of certain customer orders, for both advisory
clients and non-advisory customers, showing the terms and
conditions of such orders.  Specifically, Gruntal failed to
maintain an accurate memorandum showing the capacity in which
Gruntal acted in certain transactions.

                               IV.

Violations

     A.   Section 17(a) of the Securities Act prohibits, in the
offer or sale of securities, (1) devices, schemes, or artifices
to defraud, (2) misrepresentations or omissions of material
facts, or (3) transactions, practices, or courses of business
that would operate as a fraud.  Section 10(b) of the Exchange Act
and Rule 10b-5 thereunder prohibit devices, schemes, and
artifices to defraud in connection with the purchase or sale of
securities.  Sections 206(1) and 206(2) of the Advisers Act
prohibit an investment adviser from employing any device, scheme,
or artifice to defraud clients or engage in any transaction,
practice, or course of business that defrauds clients.  Scienter
is a required element to prove violations of Section 17(a)(1),
Section 10(b) and Rule 10b-5, and Section 206(1).  Aaron v. SEC,
446 U.S. 680, 701-02 (1980); Ernst & Ernst v. Hochfelder, 425
U.S. 185 (1976); Steadman v. SEC, 603 F.2d 1126, 1134 (5th Cir.
1979), aff'd on other grounds, 450 U.S. 91 (1981).

     B.   Gruntal violated Section 17(a), Section 10(b) and Rule
10b-5, and Sections 206(1) and 206(2) by (1) falsely representing
to advisory clients in its Form ADV that it did not execute
principal or agency cross transactions for its advisory clients,
(2) falsely representing to fee-only advisory clients that it did
not impose transaction charges on trades it executed for them;
and (3) failing to disclose to advisory clients that it received
payment for directing trades to two affiliated broker-dealers.  
==========================================START OF PAGE 7======

     C.   Section 206(3) of the Advisers Act prohibits an
investment adviser from effecting transactions for its advisory
clients on a principal or agency cross basis without, in each
instance, notifying the clients in writing, prior to the
completion of the transaction, of the capacity in which the
investment adviser is acting and obtaining the client's consent. 

     D.   Gruntal violated Section 206(3) by executing
transactions for clients of Managed Accounts and Sterling on a
principal or agency cross basis without, prior to the completion
of the transaction, disclosing the capacity in which it acted in
the transaction and without obtaining the client's consent
thereto.

     E.   Section 15(c) of the Exchange Act, and Rules 10b-3(a)
and 15c1-2 thereunder prohibit any broker or dealer from
employing any manipulative, deceptive, or otherwise fraudulent
device or contrivance when effecting any transaction in any
security otherwise than on a national securities exchange.  Rule
10b-10(a)(2)(prior to April 3, 1995, Rule 10b-10(a)(1)), requires
brokers to provide their customers with written notification at
or before completion of each transaction specifying the capacity
in which the broker is acting when executing the transaction.   

     F.   Gruntal violated Section 17(a) of the Securities Act,
Section 10(b) of the Exchange Act, Rules 10b-3(a), 10b-5, 10b-
10(a)(2) and 15c1-2 under the Exchange Act, and Sections 206(1)
and 206(2) of the Advisers Act by falsely identifying
transactions on advisory client and other customer confirmations
as agency transactions when such transactions were in fact
principal transactions.  

     G.   Section 207 of the Advisers Act prohibits the willful
making of untrue statements of material fact in applications and
reports required to be filed with the Commission pursuant to
Section 203 and 204 of the Advisers Act or the omission in such
applications and reports of material facts required to be stated
therein.

     H.   Gruntal violated Section 207 by (1) willfully making
the following false statements in its Form ADV: (a) that Gruntal
did not permit principal and agency cross transactions with
advisory clients, (b) that Gruntal utilized certain specified
procedures to prevent and detect such transactions, and (c) that
clients choosing to pay an asset-based fee would not pay separate
transaction charges and by (2) willfully omitting to disclose:
(a) the arrangement by which Gruntal received payment for
directing order flow to certain broker-dealers, and (b) that
Gruntal executed certain transactions through other broker-
dealers in which it has an ownership interest and for which it
clears transactions.
==========================================START OF PAGE 8======

     I.   Section 17(a) of the Exchange Act and Rule 17a-3
thereunder require registered broker-dealers to make and keep
certain books and records.  The requirement that certain books
and records be made also requires that those records be made
accurately.  U.S. v. Sloan, 389 F. Supp. 526, 528 (S.D.N.Y.
1975); In the Matter of Michael Alan Pettis, Exchange Act Release
No. 33254 (Nov. 29, 1993).  The Commission has emphasized the
importance of the records maintained by broker-dealers pursuant
to the Exchange Act, describing them as the "keystone of the
surveillance of brokers and dealers by our staff and by the
securities industry's self-regulatory bodies."  Edward J. Mawod &
Co., 46 SEC 865, 873 n.39 (1977), aff'd, 591 F.2d 588 (10th Cir.
1979).  Rule 17a-3(a)(6) requires a broker-dealer to maintain a
memorandum of each brokerage order or other instruction given or
received for the purchase or sale of securities, showing the
terms and conditions of the order or instructions.

     J.   Gruntal violated Section 17(a) and Rule 17a-3 by
failing to maintain an accurate memorandum of each brokerage
order correctly reflecting the capacity in which the order was
executed by Gruntal.

     K.   Section 204 of the Advisers Act and Rule 204-2 require
registered investment advisers to make and keep certain books and
records.  Rule 204-2(a)(3) requires an investment adviser to
maintain, among other things, a memorandum of each order given by
the adviser for the purchase or sale of a security, showing the
terms and conditions of the order.

     L.   Gruntal violated Section 204(a) and Rule 204-2 by
failing to maintain an accurate memorandum of each brokerage
order correctly reflecting the capacity in which the order was
executed by Gruntal.
  
     M.   While engaged in the conduct described above, Gruntal,
directly and indirectly, used the means or instrumentalities of
interstate commerce or the mails.

                                V.

     Based on the foregoing, the Commission finds that Gruntal
willfully violated Section 17(a) of the Securities Act, Sections
10(b), 15(c) and 17(a) of the Exchange Act and Rules 10b-3, 10b-
5, 10b-10, 15c1-2 and 17a-3(a)(6) thereunder, and Sections 204,
206(1), (2), and (3) and 207 of the Advisers Act and Rule 204-2
thereunder.

                               VI.

     In view of the foregoing, it is in the public interest to
impose the sanctions specified in the Offer of Settlement.  
==========================================START OF PAGE 9======

     Accordingly, IT IS HEREBY ORDERED that:

     A.   Gruntal be, and hereby is, censured;

     B.   Gruntal, pursuant to Section 8A of the Securities Act, 
Section 21C of the Exchange Act, and Section 203(k) of the
Advisers Act, cease and desist from committing or causing any
violation, and any future violation, of Section 17(a) of the
Securities Act, Sections 10(b), 15(c) and 17(a) of the Exchange
Act and Rules 10b-3, 10b-5, 10b-10, 15c1-2 and 17a-3(a)(6)
thereunder, and Sections 204, 206(1), (2), and (3) and 207 of the
Advisers Act and Rule 204-2 thereunder;

     C.   Gruntal shall pay a civil money penalty in the amount 
of $1 million pursuant to Section 21B of the Exchange Act and
Section 203(i) of the Advisers Act.  Such payment shall be: (1)
made by United States postal money order, certified check, bank
cashier's check, or bank money order; (2) made payable to the
Securities and Exchange Commission; (3) hand-delivered, within 10
business days of the date of this Order, to the Comptroller,
Securities and Exchange Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549; and      (4) submitted under cover letter
identifying Gruntal as a Respondent in these proceedings, and the
Commission's case number (NY-6306), a copy of which shall be sent
to Wayne M. Carlin, Assistant Regional Director, Northeast
Regional Office, U.S. Securities and Exchange Commission, 7 World
Trade Center, 13th floor, New York, N.Y. 10048;

     D.   Gruntal shall comply with the following 
          undertakings:

          1.   Gruntal shall retain, within 45 days of the date
          of this Order, at Gruntal's expense, an Independent
          Consultant, acceptable to the staff of the Northeast
          Regional Office of the Commission, to:

          a.   conduct a comprehensive review of Gruntal's
policies and procedures concerning: (i) execution of orders for
advisory client accounts managed by Gruntal and for Gruntal fee-
only clients, including but not limited to principal and agency-
cross transactions and execution by broker-dealers from whom
Gruntal receives payments for order flow; and (ii) the coding,
and reporting on client confirmations and internal Gruntal
records, of brokerage transactions executed by Gruntal with
respect to the capacity in which such transactions are executed;

          b.   review any policies and procedures that 
Gruntal has adopted and implemented since the activities
described in this Order, to determine whether and to what extent
there is a need for additional or amended policies and procedures
designed reasonably to prevent and detect, insofar as
==========================================START OF PAGE 10======

practicable, the same or similar violations of the federal
securities laws;

          c.   recommend policies and procedures (or amendments 
to existing policies and procedures) designed reasonably to
prevent and detect, insofar as practicable, the same or similar
violations of the federal securities laws;

          d.   (i) identify all advisory clients and brokerage
               customers financially harmed by the improper
               principal and agency cross transactions, improper
               transaction charges on trades for fee-only
               clients, and principal transactions improperly
               identified as agency transactions on client
               confirmations, and (ii) quantify the amount of
               financial harm to each such client;

          e.   quantify the amount of payment Gruntal received
               for order flow on transactions executed for
               advisory client accounts;

          f.   be entitled, to the extent that he or she deems 
appropriate, to rely upon work performed or to be performed by
Ernst & Young LLP ("E&Y"), Deloitte & Touche LLP ("D&T"),
Gruntal's Quality Assurance Task Force, and Gruntal's Operations
Department, including but not limited to, Gruntal's Operations
Control Group;

          g.   be entitled, to the extent that he or she deems 
appropriate, to hire such persons as are reasonably necessary to
perform his or her duties as set forth in this Order, to require
Gruntal to continue the engagement of D&T, and to require Gruntal
to maintain resources within its Operations Control Group to
support the efforts of the Independent Consultant;

          h.   submit a written report to Gruntal's Board
of Directors of his or her findings and recommendations, within
six months of the date of this Order.  Gruntal shall be provided
a reasonable opportunity, but in no event less than 30 days, to
comment on the Independent Consultant's review and
recommendations;

          i.   simultaneous with the submission of the written 
report referenced above to the Board of Directors of Gruntal,
submit a copy of such report to the staff of the Northeast
Regional Office of the Commission;

          j.   conduct, on an annual basis for a period of three 
years commencing with the date of this Order, an audit of the
policies and procedures described in Paragraphs VI.D.1.a. through
c. above, and the policies and procedures adopted pursuant to the
Independent Consultant's recommendations, to ensure compliance
==========================================START OF PAGE 11======

with those procedures.  As a result of such audit, the
Independent Consultant may recommend new procedures or revisions
to existing procedures, and to the system for applying such
procedures, to achieve the objectives outlined in Paragraph
VI.D.1.a. through c. above; and

          k.   report to the staff of the Northeast Regional
               Office of the Commission and Gruntal: (i) any
               material failure to comply with the procedures and
               system for applying those procedures, described in
               Paragraphs VI.D.1.a. through c. above, and the
               policies and procedures adopted pursuant to the
               Independent Consultant's recommendations; and (ii)
               any other material failure by Gruntal to comply
               with this Order; 

          2.   Gruntal shall adopt and implement, no later 
than 90 days after receipt of the Independent Consultant's report
(or such other time as the Independent Consultant believes is
necessary), such policies and procedures as recommended by the
Independent Consultant; provided however, that as to any of the
Independent Consultant's recommendations that Gruntal determines
is unduly burdensome and impractical, Gruntal may propose an
alternative procedure reasonably designed to accomplish the same
objectives.  The Independent Consultant shall reasonably evaluate
such alternative procedure and, if appropriate, either approve
the alternative procedure, amend the recommendation, or reassert
the original recommendation.  Gruntal shall abide by the decision
of the Independent Consultant and adopt and implement the
alternative procedure, amended recommendation, or the original
recommendation within the time period set by the Independent
Consultant in light of the nature of the procedures; 
==========================================START OF PAGE 12======

          3.   Gruntal shall pay to each client identified 
by the Independent Consultant's report as having been financially
harmed pursuant to Paragraph VI.D.1.d. above, within 90 days of
the submission of the Independent Consultant's report to
Gruntal's Board of Directors, an amount equal to the amount by
which each such client was harmed plus accrued interest thereon,
calculated at the Internal Revenue Service rate of interest on
tax underpayments, compounded quarterly, excluding partial
months, from the date of the violation to the date of this Order.

If it is not possible or is impractical to make such payments to
each client harmed, then the monies not returned to customers
shall be paid into the United States Treasury.  In any event,
Gruntal shall not retain the benefit of any monies improperly
obtained in connection with the violations referred to herein; 

          4.   Gruntal shall pay into the United States Treasury
          the amount of payment Gruntal received for order flow
          on transactions executed for advisory client accounts
          determined by the Independent Consultant's report plus
          accrued interest thereon, calculated at the Internal
          Revenue Service rate of interest on tax underpayments,
          compounded quarterly, excluding partial months, from
          the date of the violation to the date of this Order,
          within 45 days of the submission of the Independent
          Consultant's report to Gruntal's Board of Directors; 

          5.   Gruntal shall cooperate fully with
the Independent Consultant, including using all reasonable
efforts to obtain the cooperation of Gruntal's employees or other
persons under their control, including E&Y and D&T, and giving
the Independent Consultant full access to all documents and
premises under Gruntal's control;

          6.   To ensure the independence of the Independent
          Consultant, Gruntal:

          a.   shall not have the authority to terminate the 
Independent Consultant, without the prior written approval of the
staff of the Northeast Regional Office of the Commission;

          b.   shall compensate the Independent Consultant, 
and persons engaged to assist the Independent Consultant for
services rendered pursuant to this Order at their reasonable and
customary rates;
==========================================START OF PAGE 13======

          c.   shall not, without the prior written consent of 
the staff of the Northeast Regional Office of the Commission,
enter into any legal, business, or other financial relationship
with the Independent Consultant, any firm with which he or she is
affiliated or of which he or she is a member, or any person
engaged to assist the Independent Consultant in the performance
of his or her duties under this Order, other than as described in
this Order, during the period of their engagements and for a
period of two years following the completion of their duties
described in this Order; and 

          d.   shall not be in and shall not have an attorney-
client relationship with the Independent Consultant and shall not
seek to invoke the attorney-client or any other doctrine or
privilege to prevent the Independent Consultant from transmitting
any information, reports, or documents to the Commission or its
staff;

          7.   Gruntal shall maintain for a period of at least 
three years after the date of this Order a Committee of its Board
of Directors (the "Committee"), consisting of no fewer than three
persons, which shall: (a) monitor Gruntal's implementation of any
changes in Gruntal's policies and procedures adopted as a result
of the Independent Consultant's review process described in
Paragraphs VI.D.1.a. through c. above; and (b) monitor Gruntal's
efforts to detect, correct, and prevent failures to comply with
applicable rules and regulations.  The Committee shall provide a
quarterly report to the Board of Directors of Gruntal, which
shall include a summary of the activities of the Committee in
ensuring the fulfillment of its responsibilities under this
Order; and

          8.   Gruntal shall cooperate, and use all 
reasonable efforts to cause its present or former officers,
directors, agents, servants, employees, attorneys-in-fact,
assigns, and all persons in active concert and participation with
them to cooperate, with investigations, administrative
proceedings, and litigation conducted by the Commission, other 
==========================================START OF PAGE 14======

government agencies, securities exchanges, or SROs arising from
or relating to the conduct described in this Order.


     By the Commission.


                                                                 
                                        Jonathan G. Katz
                                        Secretary