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                SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 14950 \ June 19, 1996

SECURITIES AND EXCHANGE COMMISSION v. WILLIAM P. DILLON (United
States District Court for the District of Massachusetts, Civil
Action No. 96-11265 (RGS) (D. Massachusetts, filed June 19, 1996)

     The Securities and Exchange Commission announced the filing
of a complaint, on June 19, 1996, in the United States District
Court for the District of Massachusetts (the "Court") against
William P. Dillon ("Dillon"), alleging that he deceived several
broker-dealers in connection with a fraudulent margin trading
scheme.  The complaint alleges that, as a result of Dillon's 1995
margin trading, the broker-dealers suffered losses in excess of
$200,000.  The Commission seeks a final judgment enjoining Dillon
from further violations of certain antifraud provisions of the
securities laws, disgorgement of his ill-gotten gains and
prejudgment interest.

     On July 2, 1990, Dillon, as a result of a prior Commission
enforcement action, was barred by the Court for a period of five
years from maintaining a margin account and from trading on
margin.  The complaint alleges that Dillon, in order to avoid
this restriction, opened margin accounts at five broker-dealers
in January 1995 using the name and social security number of a
maintenance man he employed.  Dillon also submitted inflated net
worth and income figures to the broker-dealers in order to induce
the firms to open the margin accounts.  Between January and June
1995, Dillon deposited his own funds into the five accounts and,
by impersonating the maintenance man, engaged in hundreds of
securities transactions.  The Commission's complaint alleges that
Dillon made the trades without an intention or the means to pay
for the trades if large losses resulted.
    
     In June 1995, Dillon's scheme unraveled when he placed two
orders, each to sell 100 call options contracts, for the common
stock of Lotus Development Corporation ("Lotus") without owning
either the call options or the underlying Lotus stock.  On June
5, 1995, International Business Machines announced a tender offer
for all of the outstanding stock of Lotus, causing a substantial
rise in the price of Lotus.  Dillon, who became obligated to
purchase 20,000 shares of Lotus stock to cover his option
position, sustained a loss of approximately $450,000.  Dillon did
not have sufficient funds to purchase the necessary Lotus stock. 
Consequently, the broker-dealer through which Dillon had
purchased the call options became obligated to make the purchase
and suffered a loss of approximately $219,000.

     The Commission's complaint charges Dillon with violations of
the antifraud provisions contained in Section 17(a) of the
Securities Act of 1933, Section 10(b) of the Securities Exchange
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Act of 1934 and Rule 10b-5 thereunder.  In a related matter, the
U. S. Attorney's Office for the District of Massachusetts has 

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indicted Dillon and charged him with mail fraud, deceptive use of
a social security number and criminal contempt based on the
conduct detailed above.  The criminal contempt charge is based on
Dillon's failure to comply with the margin trading bar in the
Court's July 2, 1990 order.