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                SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C.

Litigation Release No. 15226 / January 23, 1997

Accounting and Auditing Enforcement 
Release No. 873 / January 23, 1997 

SECURITIES AND EXCHANGE COMMISSION v. NICHOLAS J. PACE and EUGENE
R. VALENTINE, United States District Court for the Northern
District of Ohio, Civil Action No. 5:95CV1999 (Dowd).

     The Securities and Exchange Commission today announced that
on December 23, 1996, the United States District Court for the
Northern District of Ohio issued an injunction by consent against
Eugene R. Valentine ("Valentine") of Massillon, Ohio.  The
injunction prohibits Valentine from violating Section 13(b)(5) of
the Securities Exchange Act of 1934 and Rules 13b2-1 and 13b2-2
by knowingly falsifying any book, record or account required by
the Commission and from making any materially false or misleading
statements to an accountant in connection with the audit or
examination of the financial statements of an issuer, or
preparation or filing of any document or report required by the
Commission.  It also requires Valentine to pay a civil penalty of
$50,000.  Valentine was formerly the president, chief executive
officer and chairman of the board of Valley Systems, Inc.
("Valley"), a publicly held industrial cleaning company
headquartered in Canal Fulton, Ohio.

     The Commission filed its Complaint against Valentine and
three other individuals on September 14, 1995.  The Complaint
alleged that Valley filed with the Commission three quarterly
reports that materially overstated net income.  According to the
Complaint, the overstatements of net income resulted, in part,
from improperly capitalizing certain costs and understating
workers' compensation insurance expenses.  The amended Complaint
alleged that Valentine was aware that Valley had understated
workers' compensation insurance expenses and, after Valley's
fourth quarter of fiscal 1992, allegedly directed Valley's chief
financial officer to record $1.14 million in fictitious revenue
in Valley's books and records as of the last day of the fourth
quarter.  The Complaint also alleged that, during the audit of
Valley's fiscal 1992 financial statements, Valentine attempted to
mislead Valley's auditors about the fictitious revenue by
claimuing that Valley had earned the revenue by renting
equipment.

     Valentine consented to the entry of the injunction and the
imposition of a civil penalty without admitting or denying the
allegations in the Complaint.  See Litigation Release No.
14637/AAER No. 708.