LITIGATION RELEASE NO. 16366 / NOVEMBER 19, 1999

SECURITIES AND EXCHANGE COMMISSION V. SUNPOINT SECURITIES, INC., VAN R. LEWIS III AND MARY ELLEN WILDER,

Case No. 6:99-CV-667, USDC, EASTERN DISTRICT OF TEXAS, TYLER DIVISION

The U.S. Securities and Exchange Commission ("Commission") announced today that it filed a civil lawsuit charging two corporate officers of Sunpoint Securities, Inc. ("Sunpoint" or "the firm"), a self-clearing broker-dealer registered with the Commission, with systematically looting as much as $25 million from a money market account which the firm maintained for its customers. The Commission's complaint alleges that from December 1997 through the present, Sunpoint illegally transferred money market funds belonging to its customers to the firm's clearing account for the firm's operating capital, to satisfy the firm's net capital requirements and for the personal benefit of the firm's president and chief executive officer. The diversion of customer funds resulted in the firm presently having available only approximately $12 million in the customer money market account to cover about $37 million in money market obligations to its customers. As a result of this shortfall, Sunpoint is grossly below its net capital and customer reserve requirements. The firm ceased business on November 18, 1999.

Until ceasing business, Sunpoint was a full service, self-clearing broker-dealer based in Longview, Texas, which has been registered with the Commission since 1989. The firm is a member of the National Association of Securities Dealers ("NASD"). Sunpoint has over 100 registered representatives throughout the country, many of whom operate out of one-person offices. The firm also has larger branch offices in Fort Worth and Tyler, Texas, Rochester and Yonkers, N.Y., Chantilly, Virginia, and Wyomissing, York and Pittsburgh, Pennsylvania. Sunpoint's common stock is traded on the OTC Bulletin Board under the symbol "SNPC".

According to the Commission's complaint, the scheme was devised, and/or participated in, by Van R. Lewis, III ("Lewis") and Mary Ellen Wilder ("Wilder").

Lewis, age 53, is the founder, CEO and majority shareholder of Sunpoint. Lewis has been in the securities industry since 1988 and is a registered principal. In June 1994, Lewis was sanctioned by the NASD for violating certain NASD rules which resulted in a net capital violation by Sunpoint. In September 1994, he was sanctioned by a state securities regulator for violations of the net capital rule and for engaging in dishonest or unethical practices.

Wilder, age 56, is the CFO and a minority shareholder of Sunpoint. Wilder has been in the securities industry since 1993 and is a registered principal. In August 1998, Wilder was sanctioned by the NASD for violating certain NASD rules which resulted in a net capital violation by Sunpoint.

Simultaneously with the filing of the Commission's lawsuit, the Securities Investor Protection Corporation, known as "SIPC," has filed an application with the Court to have a SIPC trustee appointed to liquidate Sunpoint for the benefit of the firm's customers and other creditors. The Commission has consented to allow SIPC to join the lawsuit for this purpose. Sunpoint's board of directors, acting on behalf of the firm, has agreed to consent to the SIPC action and the appointment of a SIPC trustee.

In its lawsuit, filed today, the Commission has sought emergency orders: (1) temporarily restraining and enjoining Sunpoint, Lewis, and Wilder from continuing to violate the federal securities laws; (2) freezing the assets of Sunpoint, Lewis and Wilder; (2) requiring Lewis and Wilder to separately furnish an accounting, including an accounting of monies diverted from the money market account maintained by Sunpoint for its customers; (4) prohibiting the destruction of documents; and (5) authorizing expedited discovery. Sunpoint, without admitting or denying any wrongdoing, has agreed to an Order of Preliminary Injunction providing all of the emergency relief sought against it by the Commission.

In its complaint, the Commission alleges that Sunpoint, Lewis and Wilder violated and/or aided and abetted violations of the following provisions of the federal securities laws: (1) the Antifraud Provisions, at Section 17(a) of the Securities Act of 1933, and Sections 10(b) and 15(c)(1) of the Securities Exchange Act of 1934 ("Exchange Act") and Rules 10b-5 and 15c1-2 thereunder; (2) the Broker-Dealer Net Capital and Customer Reserve Provisions, Section 15(c)(3) of the Exchange Act and Rules 15c3-1 and 15c3-3 thereunder; and (3) the Broker-Dealer Reporting and Record-Keeping Provisions, Sections 17(a) and 17(e) of the Exchange Act and Rules 17a-3 and 17a-5 thereunder. In addition to the emergency relief described above, the Commission is seeking preliminary and permanent injunctions restraining future violations of the foregoing provisions of the federal securities laws; an order requiring the defendants to disgorge all wrongfully obtained profits plus prejudgement interest; and civil penalties.

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For further information about SIPC, you can access the SIPC web site at www.sipc.org.