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               SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C.

LITIGATION RELEASE NO. 15260/ FEBRUARY 18, 1997
ACCOUNTING AND AUDITING ENFORCEMENT RELEASE NO. 886    

SECURITIES AND EXCHANGE COMMISSION v. FABRI-CENTERS OF AMERICA,
INC., ROBERT L. NORTON and JOSEPH E. WILLIAMS, Civil Action No.  

97CV-00319 (D.D.C.) (Filed February 18, 1997)

     On February 18, 1997, the Securities and Exchange Commission
filed a civil injunctive action in the United States District
Court for the District of Columbia charging Fabri-Centers of
America, Inc. ("Fabri-Centers"), a New York Stock Exchange-listed
fabric and crafts retailer, Robert L. Norton ("Norton") and
Joseph E. Williams ("Williams") with materially overstating
Fabri-Centers' earnings and profitability prior to a $74.75
million convertible debt offering in March 1992 and in the next
three fiscal quarters, by misusing the "gross profit method" of
accounting to inflate the company's earnings.  The Commission's
complaint also charges Fabri-Centers and Norton with making
materially misleading public statements in May and June 1992. 
The complaint charges that Fabri-Centers, Norton and Williams
violated the antifraud provisions of both the Securities Act of
1933 ("Securities Act") and the Securities Exchange Act of 1934
("Exchange Act").  The complaint also charges Fabri-Centers with
violations of the periodic reporting, books and records, and
internal controls provisions of the Exchange Act.

     The complaint charges that the defendants deviated from
prior accounting practice, erroneously calculated a key inventory
reserve and failed to disclose heightened price competition when
they filed with the Commission the company's annual report on
Form 10-K for the fiscal year ended February 1, 1992.  As a
result, Fabri-Centers' Form 10-K and S-3 Registration Statement
materially overstated earnings and profitability for the fourth
quarter and fiscal year ended February 1, 1992.  The complaint
further alleges that these overstatements allowed Fabri-Centers
to sell its convertible debt at better prices and on more
favorable terms than if accurate information had been provided.

     The Commission's complaint charges that Norton, Fabri-
Centers' former Chief Financial Officer, and Williams, Fabri-
Centers' former Controller, circumvented the company's internal
accounting controls and that Norton made false and misleading
statements to the company's auditors in connection with the debt
offering.

     Without admitting or denying the Commission's allegations,
Fabri-Centers consented to entry of a final judgment permanently
enjoining it from violating Section 17(a) of the Securities Act,
Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(2)(B) of the Exchange





Act and related rules thereunder.  Fabri-Centers also agreed to
disgorge $3.28 million in connection with the settlement.  The
Commission's litigation is proceeding against Norton and
Williams.

     In a related matter, the Commission instituted and settled
administrative proceedings against Alan D. Rosskamm ("Rosskamm"),
Fabri-Centers' current Chief Executive Officer and Chairman. 
Rosskamm, without admitting or denying the allegations, consented
to the entry of findings that he:  (i) violated Sections 17(a)(2)
and (a)(3) of the Securities Act and Exchange Act Rule 13b2-2 by
failing to make adequate inquiry before signing representation
letters to the company's independent auditors in March 1992 and
(ii) caused Fabri-Centers to violate Section 13(a) of the
Exchange Act and Rules 12b-20 and 13a-13 thereunder by signing
and approving the company's Form 10-Q for the fiscal quarter
ended May 2, 1992.