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SECURITIES AND EXCHANGE COMMISSION


Litigation Release 14686 / October 11, 1995
Accounting and Auditing Enforcement 731 / October 11, 1995      

SEC v. Digitran Systems, Donald G. Gallent and James R. Bryan,
Civil Action No. 94C-NC-173C (USDC UT).

The Commission announced that on September 29, 1995, the
Honorable Tena Campbell of the U. S. District Court for the
District of Utah issued a Final Judgment of Permanent Injunction
against Digitran Systems, Inc. ("Digitran").  Digitran, which
consented to the order without admitting or denying the
Commission's allegations was enjoined from further violations of
the antifraud and reporting provisions of the federal securities
laws.

The Commission's Complaint, filed on December 29, 1994, alleged
that Digitran made false and misleading statements concerning the
company's sales and leases of simulators and about its financial
condition and operations.  According to the Complaint, Digitran
improperly recognized revenue on several transactions, claiming
that it had sold simulators to companies when, in fact, it had
not.  As a result, this conduct resulted in an overstatement of
revenue recognized of between 46% to 93% for various periods. 
These overstatements of revenue were included in Digitran's
filings with the Commission, including its quarterly and annual
reports and a registration statement.  The overstatements of
revenue were also included in a number of press releases.

The Complaint also alleges that Digitran and Donald G. Gallent
and James R. Bryan failed to maintain sufficient internal
accounting controls and misled Digitran's auditors in connection
with an audit of Digitran's financial statements for the fiscal
year ended April 30, 1992.

The Commission's Complaint also names two additional defendants,
Donald G. Gallent, the president of Digitran at the time the
alleged conduct occurred, and James R. Bryan, Digitran's chief
financial officer at the time the alleged conduct occurred.  No
resolution of the lawsuit has been reached as to these two
individuals.