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               SECURITIES AND EXCHANGE COMMISSION 

Litigation Release 15239 / February 3, 1997

United States Securities and Exchange Commission v. James
Zimmerman and Old Naples Securities, Inc., Case No. 96-304-CIV-
FTM-17D (M.D. Fla.)

     On January 24, 1997, the Honorable Elizabeth A. Kovachevich,
United States District Judge for the Middle District of Florida,
entered a final judgment of permanent injunction enjoining:  (a)
Old Naples and Zimmerman from future violations 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
thereunder; and (b) Old Naples from future violations of Sections
17(a) and 15(c) of the Exchange Act and Rules 17a-3, 17a-5 and
15c3-1 thereunder.  Old Naples is registered with the Commission
as both a broker-dealer and an investment adviser.  Zimmerman and
Old Naples consented to the entry of the final judgment without
admitting or denying the allegations of the Commission's
complaint, filed on August 28, 1996.   

     The complaint alleged that Zimmerman and Old Naples, during
the period from in or about July 1992 to in or about August 5,
1996:  (a) received in excess of $3.5 million dollars from
investors by misrepresenting to prospective investors and
investors that the funds received for investments had been or
were to be used to purchase securities, when, in fact, no
securities were purchased and the funds had been misappropriated
and/or used to pay previous investors and personal expenses; and
(b) created and distributed to investors fictitious periodic
account statements misrepresenting the financial condition of the
customers' accounts in order to create the appearance that the
purported investments were increasing in value.  The complaint
also alleged that Old Naples, during the period from in or about
July 1992 to in or about August 5, 1996: (a) failed to create
accurate books and records with respect to (i) its net capital
computation, and (ii) its blotters or other records of original
entry; (b) filed Part IIA of Form X-17A-5 with the National
Association of Securities Dealers, Inc., which contained
inaccurate net capital computations; and (c) effected
transactions in, or induced or attempted to induce the purchase
and sale of securities at a time when Old Naples did not have and
did not maintain the required minimum net capital to legally
transact a securities business.  

     Contact person: Spencer C. Barasch, SERO, (305) 982-6336