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                     UNITED STATES OF AMERICA
                            Before the
                SECURITIES AND EXCHANGE COMMISSION


Securities Exchange Act of 1934
Release No. 38220  /  January 30, 1997

Administrative Proceedings
File No. 3-8950

-------------------------------                               
                              :    ORDER MAKING FINDINGS
     In the Matter of         :    AND IMPOSING REMEDIAL 
                              :    SANCTIONS PURSUANT TO 
     Jon Edelman              :    SECTIONS 15(b) AND 19(h)
                              :    OF THE SECURITIES
               Respondent     :    EXCHANGE ACT OF 1934
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                                I.

     The Securities and Exchange Commission ("Commission")
instituted an administrative proceeding pursuant to Sections
15(b) and 19(h) of the Securities Exchange Act of 1934 ("Exchange
Act") against Jon Edelman ("Edelman") on February 14, 1996.  In
the Matter of Jon Edelman, Securities Exchange Act of 1934,
Release No. 36847 (February 14, 1996).  

     In this proceeding, Edelman has submitted an Offer of
Settlement ("Offer"), 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 to which
the Commission is a party, Edelman has consented, without
admitting or denying the matters set forth herein, except as to
the fact of his criminal convictions set forth in paragraph II.C.
below and his challenge thereto as set forth in paragraph II.E.
below, which he admits, to the findings and sanctions contained
in this Order Making Findings and Imposing Remedial Sanctions
("Order").  

                               II.

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

     A.   Respondent was born in 1946 and is incarcerated at the
          Federal Correction Institution in Texarkana, Texas.

     B.   Respondent was associated with, and a principal of,
          Arbitrage Management, a registered broker-dealer, from
          October 1978 to December 1984.  Respondent was
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          associated with, and a principal of, Wharton
          Securities, also a registered broker-dealer, from
          November 1982 to June 1984.  

     C.   On February 4, 1991, Respondent was convicted, after a
          jury trial in the United States District Court for the
          Southern District of New York, of twenty-four counts of
          felony tax fraud in violation of 26 U.S.C.  7206(1)
          and 7206(2).  In addition, Edelman was convicted of one
          felony count under 18 U.S.C.  371 for conspiracy to
          defraud the Internal Revenue Service.  United States v.
          Bernhard F. Manko, a/k/a "Fred," and Jon Edelman, 89
          Cr. 91 (S.D.N.Y. February 4, 1991), aff'd, 979 F.2d 900
          (2d Cir. 1992), cert. denied, 509 U.S. 903, 113 S. Ct.
          2993 (1993).  

     D.   The indictment underlying the convictions charged
          Respondent with participating in a scheme to defraud
          the United States government by means of bogus
          securities transactions that generated $532 million in
          false and fraudulent tax deductions.  The fraudulent
          scheme charged in the indictment occurred in 1982 and
          1983, while Edelman was associated with Arbitrage
          Management and Wharton Securities.

     E.   Respondent has challenged the validity of the
          convictions referred to in paragraphs C. and D. above. 
          Jon Edelman v. United States, 96 Civ. 3667 (S.D.N.Y.
          filed March 20, 1996).

                               III.

     In view of the foregoing, the Commission finds that it is
appropriate and in the public interest to impose the sanctions
which are set forth in the Offer submitted by Edelman.

     Accordingly, IT IS HEREBY ORDERED that, effective
immediately, Jon Edelman be, and hereby is, barred from
association with any broker, dealer, investment adviser,
investment company or municipal securities dealer; provided,
however, that this Order will be vacated by the Commission, upon
application by Edelman, if the United States District Court for
the Southern District of New York or an appellate court enters an
order vacating or reversing Edelman's convictions in the case
captioned United States v. Bernhard F. Manko and Jon Edelman, 89
Cr. 91 (S.D.N.Y. 1989) and such order is either not timely
appealed or is not reversed on appeal.

     By the Commission.
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                                   Jonathan G. Katz
                                   Secretary