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U.S. Securities and Exchange Commission

Washington, D.C.

Securities Exchange Act of 1934
Release No. 50320 / September 7, 2004

Admin. Proceeding File No. 3-11633

In the Matter of Frederick Tropeano

The Securities and Exchange Commission ("Commission") announced today that it issued an Order Instituting Public Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Order") against Frederick Tropeano ("Tropeano"), a resident of Brooklyn, New York. In the Order, the Division of Enforcement ("Division") alleges that the United States District Court for the Southern District of New York has issued a permanent injunction against Tropeano, and found him liable for making fraudulent misrepresentations and omissions of material fact to induce investors to invest in a purported private placement of the stock of Golf Emporium Corporation ("Golf"), a now dissolved New York corporation of which Tropeano was President and CEO. The complaint alleged that Tropeano's misrepresentations, included, but were not limited to, claims that (a) Golf was about to commence an Initial Public Offering ("IPO") that would cause the price of Golf stock to increase to many times the $2 per share private placement price; (b) Golf had meetings with the Commission's staff about the Golf IPO and about listing Golf stock on the NYSE or NASDAQ; and (c) Golf had registered the IPO with the Commission. Through his fraudulent conduct, Tropeano raised approximately $3,427,160 from 225 investors in Golf's purported private placement.

The Division alleges that on September 12, 2000, a Final Judgment By Default was entered against Tropeano, permanently enjoining him from future violation of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 promulgated under the Exchange Act, in the civil action entitled Securities and Exchange Commission v. Golf Emporium Corporation and Frederick Tropeano, Civil Action No. 99 Civ. 10259 (JSR), in the United States District Court for the Southern District of New York. In addition, the Division alleges that on February 11, 2000, Tropeano pleaded guilty to one felony count of conspiracy to commit securities fraud and one felony count of wire fraud before the United States District Court for the Southern District of New York, in United States v. Frederick Tropeano, et al., 99 Cr. 01024 (S.D.N.Y.)(SAS). On May 24, 2000, a criminal judgment was entered against Tropeano, sentencing him to a prison term of 38 months followed by three years of supervised release.

A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide Tropeano an opportunity to dispute these allegations, and to determine what, if any, remedial sanctions against Tropeano are appropriate and in the public interest pursuant to Section 15(b) of the Exchange Act. The Commission directed that an administrative law judge issue an initial decision in this matter within 210 days from the date of service of the Order Instituting Proceedings.

See also the Order in this matter



Modified: 09/07/2004