UNITED STATES OF AMERICA
                                     before the
                         SECURITIES AND EXCHANGE COMMISSION

          SECURITIES ACT OF 1933
          Release No.   7672 / April 28, 1999

          SECURITIES EXCHANGE ACT OF 1934
          Release No.  41340 / April 28, 1999

          ADMINISTRATIVE PROCEEDING
          File No. 3-9690


                                             :    ORDER MAKING FINDINGS
          In the Matter of                   :    AND IMPOSING REMEDIAL
                                             :    SANCTIONS
                                             : 
          JOSEPH P. TUFO,                    :
                                             :
               Respondent.                   :
                                             :
                                             :

                                          I.

               The   Securities   and  Exchange  Commission  ("Commission")
          instituted public administrative and cease-and-desist proceedings
          pursuant to Section 8A of the Securities Act of 1933 ("Securities
          Act")  and  Sections 15(b),  19(h)  and  21C  of  the  Securities
          Exchange Act  of  1934  ("Exchange  Act")  against Joseph P. Tufo
          ("Tufo") on September 1, 1998.

                                         II.

               Respondent  Tufo  has  submitted  an  Offer   of  Settlement
          ("Offer") to the Commission, which the Commission has  determined
          to  accept.   Solely  for the purpose of this proceeding and  any
          other proceeding brought by or on behalf of the Commission, or in
          which the Commission is a party, and without admitting or denying
          the findings contained  herein,  except as to the jurisdiction of
          the Commission over Respondent Tufo  and  over the subject matter
          of this proceeding and as to Section III.,  paragraph  1., below,
          which are admitted, Respondent Tufo by his Offer consents  to the
          entry of findings and remedial sanctions set forth below.

                                        III.

               On  the  basis  of  this  Order  and  the Offer submitted by
          Respondent Tufo, the Commission finds that:

               1.   At all relevant times, Respondent  Tufo  was associated
          as   a  registered  representative  with  SIFE,  a  broker-dealer
          registered with the Commission.

                          The Fraudulent Offer and Sale of
                            Medco, Inc., Promissory Notes

               2.   From  approximately  September 1996 until October 1997,
          Medco, Inc. ("Medco") fraudulently offered and sold securities to
          the  general  public  in  the form of  promissory  notes  ("Medco
          notes").  Medco raised over  $16  million  from approximately 400
          investors  nationwide.   Medco claimed that capital  raised  from
          investors would be used to purchase medical equipment which would
          serve   as  collateral  for  the   investment.    Investors   and
          prospective investors received offering materials which described
          Medco and  the  investment program.  Specifically, investors were
          told that the investment  was fully secured and collateralized by
          medical equipment appraised  at  a 50% loan to value ratio (i.e.,
          twice  the value of the investor’s  principal  investment).   The
          offering  package  also  included  detailed  biographies  of  its
          principals,  including  its  president.   Medco  did  not provide
          investors with any documents reflecting the purchase or  lease of
          the  medical  equipment.  Medco  promised  investors  returns  of
          between  12% and 16% per annum depending upon the maturity of the
          note and the  amount  invested.  Interest was paid monthly during
          the term of the Medco notes and there  was  no minimum or maximum
          investment.  No registration statement was ever  filed  or was in
          effect  with  the  Commission  in  connection with the securities
          offered by Medco.

               3.   Medco falsely represented  to  investors  that  it  was
          using investor funds to purchase and lease medical equipment.  In
          fact,  of  the  $16  million  raised  from  investors,  less than
          $500,000  was used to purchase and lease medical equipment.   The
          remaining investor  proceeds  were  completely unsecured because,
          contrary to what was represented, no  other  equipment  was being
          purchased  or  leased. Instead, a substantial portion of investor
          funds were used  to  purchase  aircraft,  a  home, cars and other
          expenditures  for  the  personal  use  and  benefit   of  Medco’s
          principals.   In addition, Medco was operating a Ponzi scheme  by
          using  new investor  monies  to  pay  interest  to  its  existing
          investors.

               4.   Medco’s  offering  materials misrepresented and omitted
          material  information  concerning   the   background  of  Medco’s
          president.   For  example,  Medco’s  offering  materials  falsely
          represented that its president had a law degree, had worked for a
          major  securities brokerage firm, was a member of  the  board  of
          directors  of  a large metropolitan hospital, and implied that he
          was registered as  an  investment  adviser  with  the Commission.
          None  of  this  was  true.   Furthermore,  the offering documents
          failed to disclose that Medco’s president had  been terminated by
          a now defunct broker-dealer in 1986 for falsifying information on
          his employment application and Form U-4.

                         5.   Medco  also  misrepresented its  operating  history  to
          investors.  In its offering materials,  Medco  stated that it had
          "marshaled its depth of talent and long history  in  the  medical
          and  financial  fields  to  forge  one  of  the most exciting low
          risk/high  return, stable products for the savvy  investor."   On
          its Internet  web  page,  Medco  represented  that it had been in
          business for sixteen years.  In fact, Medco first incorporated in
          August 1996 and only became licensed to do business in Florida in
          January  1997.  Prior to forming the company, Medco’s  president,
          had no apparent connection to the medical equipment industry.




                     Tufo’s Participation in the Medco Offering

               6.   Tufo  learned  of  Medco from a newspaper advertisement
          that was soliciting sales agents  to market the Medco investment.
          After  being  recruited  by  Medco,  from  October  1996  through
          September 1997, Tufo raised approximately  $3.8  million  in  the
          Medco  notes from 87 investors, earning approximately $176,500 in
          commissions.   Tufo solicited prospective Medco investors through
          newspaper and radio advertisements throughout California, as well
          as through a web page on the Internet.

               7.   When contacted by a prospective investor in response to
          an advertisement,  Tufo  would  provide the investor with a brief
          overview of the Medco program, and  would  arrange  for  Medco to
          send  the offering materials to the prospect.  The Medco offering
          materials contained false information about the investment.  Tufo
          would then  send  a follow up solicitation letter to the prospect
          which  reiterated  the  information  contained  in  the  offering
          materials provided by  Medco  and  scheduled a sales presentation
          visit with the prospect.

               8.   In  a  typical  sales  presentation  to  a  prospective
          investor,  Tufo  would  repeat the representations  contained  in
          Medco’s offering materials  which  included  the  false statement
          that  each  investment  was  insured  and  doubly collateralized.
          During his sale presentation, Tufo would use a "comparison sheet"
          showing the differences between an investment  in the SIFE mutual
          fund  he  also  offered and the Medco notes.  In this  comparison
          sheet, Tufo included  false  information provided to him by Medco
          that Medco had been in business  since  1980  and that it had $37
          million in assets.  He described the Medco notes  to investors as
          "totally safe" and "safe and secure" because, according  to  him,
          the  investments  were secured by liens on the medical equipment.
          Tufo told one prospective investor that the investment was "safer
          than a certificate  of  deposit or a money market account".  Tufo
          told several others that he had performed due diligence on Medco.

               9.   In June 1997 and  July  1997,  the  State of California
          issued  desist  and refrain orders against Tufo for  selling  the
          unregistered Medco  securities  and for acting as an unregistered
          broker-dealer.  In an attempt to  evade the California desist and
          refrain orders, Medco retained California  securities counsel and
          re-defined  and  restructured  the offering in  California  as  a
          "joint  venture"  between  Medco  and  the  investor.  Tufo  then
          continued to offer and sell the Medco  notes through these "joint
          ventures",  raising  $1.3  million  from 8 investors.   Tufo  did
          receive  a  copy  of  a written opinion from  Medco’s  California
          securities counsel regarding the "joint venture" program, but not
          until after he had sold the "joint ventures" to two investors.

               10.  In July 1997,  during  a  deposition  before California
          regulators in connection with the desist and refrain orders, Tufo
          admitted  that  he  made  no effort to check Medco’s  president’s
          background  besides  calling  the  references  contained  in  the
          offering  materials.  He  stated  that  he  called  the  National
          Association of Securities Dealers, Inc. ("NASD") to inquire about
          complaints  against  Medco’s  president.  Tufo did not attempt to
          verify  with  the  NASD  or  with  prior   employers,  the  prior
          employment history of Medco’s president.  However,  an inquiry to
          the  NASD  would  have  revealed that Medco’s president had  been
          terminated  by  a  broker-dealer   in  1986  for  falsifying  his
          employment application. Tufo further  admitted in the deposition,
          that,  other  than  speaking  with  an  individual,   a  personal
          acquaintance  of 2 years, who told Tufo he was working for  Medco
          finding doctors  and clinics, he did not undertake any efforts to
          verify that Medco  was purchasing medical equipment at a 50% loan
          to value ratio and leasing  them  as  represented  to  investors.
          During  this  deposition,  Tufo  was  made  aware  by  California
          regulators   of  the  fraudulent  representations  regarding  the
          background of  Medco’s president.  He was also put on notice that
          he had failed to  obtain  independent verification of many of the
          representations  contained in  Medco’s  offering  materials.   In
          addition, Tufo admitted  in this deposition that in June 1997, he
          was aware that the State of  Texas had issued a cease publication
          order against Medco. Nonetheless,  Tufo  continued  to  offer and
          sell  the Medco notes to the public through the "joint ventures",
          raising  $1.3  million  of  the total $3.8 million he raised from
          investors through the offering.

               11.  Due to the blatant nature of Medco’s misrepresentations
          and fraudulent scheme, even a  minimal amount of investigation by
          Tufo would have revealed the fraud.   For  example,  Tufo made no
          attempt to independently verify that medical equipment  was being
          purchased and leased, and that they were appraised at a 50%  loan
          to value ratio by Medco as represented.  Further, an inquiry into
          any portion of the purported background and experience would have
          revealed  that Medco’s president did not have a law degree, never
          worked for  a major securities brokerage firm, was never a member
          of the board  of  directors of a large metropolitan hospital, and
          was  never  registered   as   an   investment  adviser  with  the
          Commission.

               12.  Tufo was also confronted with  a  number of "red flags"
          which should have alerted him to the fact that  Medco was engaged
          in a fraudulent offering.  For example, Tufo was  told by Medco’s
          president early on that "[u]nder no circumstances would  I  allow
          an  investor to get a copy of an equipment lease on his or anyone
          else’s equipment."  This alone should have raised concerns on his
          part about Medco’s representations that it was buying and leasing
          equipment.    In  addition,  despite  being  told  by  California
          regulatory officials  that  Medco’s  offering materials contained
          false information regarding the background  of Medco’s president,
          Tufo continued with the Medco offering. Finally, it is noteworthy
          that  in November 1996, the month after he began  selling  Medco,
          California  had  served  Tufo  with a desist and refrain order to
          halt his unregistered offers and  sales  of  promissory  notes in
          another  securities  offering.   Notwithstanding  this California
          order, Tufo went on to sell the Medco notes.

               13.  Tufo   recklessly   distributed  false  and  misleading
          offering materials, flyers and  other  materials to investors and
          prospective  investors  which  included,  among   other   things,
          representations  that the Medco notes were a low risk investment,
          that  investor  proceeds   would   be  used  to  acquire  medical
          equipment, that investor funds would  be fully secured, and which
          contained false statements and omissions  about the background of
          Medco’s president.  These misrepresentations  would be considered
          important  by any reasonable investor and are therefore  material
          under  the  standards  enunciated  in  TSC  Industries,  Inc.  v.
          Northway, Inc., 426 U.S. 438 (1976).

                                   Legal Findings

               14.  Based  upon  the  aforesaid  conduct,  Respondent  Tufo
          willfully  violated,  and  committed  or  caused  violations  of,
          Sections  5(a)  and  5(c)  of  the  Securities  Act,  in that he,
          directly and indirectly, made use of the means and instruments of
          transportation  and communication in interstate commerce  and  of
          the mails, to offer  to sell and to sell to members of the public
          certain securities, namely  the Medco notes issued by Medco, when
          no registration statement was  filed  or  in  effect  as  to said
          securities pursuant to the Securities Act.

               15.  Based  upon  the  aforesaid  conduct,  Respondent  Tufo
          willfully  violated,  and  committed  or  caused  violations  of,
          Section  10(b)  of the Exchange Act and Rule 10b-5 thereunder, in
          that,  in connection  with  the  purchase  and  sale  of  certain
          securities, namely the Medco notes issued by Medco, by use of the
          means and  instrumentalities of interstate commerce and by use of
          the mails, Respondent  Tufo,  directly  and  indirectly, employed
          devices,   schemes,   and  artifices  to  defraud;  made   untrue
          statements of material  facts and omitted to state material facts
          necessary in order to make  the  statements made, in light of the
          circumstances under which they were  made,  not  misleading;  and
          engaged  in  acts, practices and a course of business which would
          and did operate as a fraud and deceit.

               16.  Based  upon  the  aforesaid  conduct,  Respondent  Tufo
          willfully  violated,  and  committed  or  caused  violations  of,
          Section 17(a)(1) of the Securities Act, in that, in the offer and
          sale  of  certain  securities,  namely  the Medco notes issued by
          Medco, by use of the means and instruments  of transportation and
          communication  in interstate commerce and by use  of  the  mails,
          Respondent  Tufo,  directly  and  indirectly,  employed  devices,
          schemes and artifices to defraud.

               17.  Based  upon  the  aforesaid  conduct,  Respondent  Tufo
          willfully  violated,  and  committed  or  caused  violations  of,
          Sections 17(a)(2) and 17(a)(3) of the Securities Act, in that, in
          the  offer and sale of certain securities, namely the Medco notes
          issued  by  Medco,  by  the  use  of the means and instruments of
          transportation and communication in  interstate  commerce  and by
          use  of  the  mails,  Respondent  Tufo  directly  and indirectly,
          obtained  money  or  property  by  means of untrue statements  of
          material facts and omissions to state material facts necessary in
          order to make the statements made, in  light of the circumstances
          under  which  they  were  made, not misleading;  and  engaged  in
          transactions, practices and  a course of business which would and
          did  operate  as  a  fraud and deceit  upon  the  purchasers  and
          prospective purchasers of such securities.
               18.  Respondent  Tufo   has  submitted  a  sworn  bankruptcy
          petition  and  other  evidence and  has  asserted  his  financial
          inability to pay disgorgement  plus  prejudgment  interest  and a
          civil  penalty.  The Commission has reviewed the sworn bankruptcy
          petition  and  other evidence provided by Respondent Tufo and has
          determined that  Respondent  Tufo  does  not  have  the financial
          ability to pay disgorgement of $176,500 plus prejudgment interest
          and a civil penalty.

                                         IV.

               Based on the foregoing, the Commission deems it  appropriate
          and  in the public interest to impose the sanctions specified  by
          Respondent Tufo in his Offer.

               Accordingly, IT IS ORDERED that:

                1.  Respondent   Tufo   be,  and  hereby  is,  barred  from
          association with any broker, dealer, municipal securities dealer,
          investment  adviser or investment  company,  with  the  right  to
          reapply for association  after three (3) years to the appropriate
          self-regulatory  organization,  or  if  there  is  none,  to  the
          Commission.

               2.   Respondent  Tufo  cease  and  desist from committing or
          causing any violations and any future violation of Sections 5(a),
          5(c)  and  17(a)  of  the Securities Act, Section  10(b)  of  the
          Exchange Act and Rule 10b-5, promulgated thereunder.

               3.   Respondent Tufo shall pay disgorgement of $176,500 plus
          prejudgment interest, but  that  payment of such amount be waived
          based upon Respondent’s demonstrated financial inability to pay.

               4.   The Division of Enforcement  may, at any time following
          the entry of this Order, petition the Commission  to:  (1) reopen
          this matter to consider whether Respondent Tufo provided accurate
          and   complete   financial   information   at   the   time   such
          representations were made;  (2) determine the amount of the civil
          penalty  to be imposed; and (3) seek any additional remedies that
          the Commission  would  be authorized to impose in this proceeding
          if Respondent’s Offer had  not  been  accepted.   No other issues
          shall be considered in connection with this petition  other  than
          whether  the  financial  information  provided  by Respondent was
          fraudulent, misleading, inaccurate or incomplete  in any material
          respect,  the amount of civil penalty to be imposed  and  whether
          any additional  remedies  should be imposed.  Respondent may not,
          by way of defense to any such  petition,  contest the findings in
          this Order or the Commission’s authority to impose any additional
          remedies that were available in the original proceeding.

               By the Commission.




                                        Jonathan G. Katz
                                        Secretary