U.S. SECURITIES AND EXCHANGE COMMISSION


     Litigation Release No.   15738  / May 14, 1998

     Accounting and Auditing Enforcement
     Release No.  1035 / May 14, 1998

     SECURITIES AND EXCHANGE COMMISSION v. PAUL R. SAFRONCHIK, JEROME A. ADAMO,
     and DOUGLAS A. ROY, Civil Action No. SACV 98-416-LHM  (EEx) (C.D. Cal)

     On May 13, 1998, the Securities and Exchange Commission sued three former
     officers of an Orange County company in federal court in Santa Ana,
     California, charging them with fraud and insider trading.  The company,
     Home Theater Products International, Inc. ( HTPI ), which is now in
     bankruptcy, was headquartered in Anaheim, California and had manufactured
     and sold home theater systems under a license from Paramount Pictures, a
     movie studio in Hollywood, California.  The Commission alleged that two of
     the officers, Paul R. Safronchik, HTPI s chairman and chief executive
     officer, and Douglas A. Roy, the company s controller, falsified HTPI s
     books and records and inflated the company s sales and income.  The
     Commission further alleged that Safronchik and Jerome A. Adamo, the
     president and chief operating officer, caused HTPI to release to the public
     phony financial statements.  Additionally, the Complaint alleged all three
     officers committed insider trading by selling HTPI stock with knowledge
     that the company s financial statements were false.

     The Commission s lawsuit alleges that, from 1993 until October 1995,
     Safronchik and Roy falsified sales in HTPI s books and records. 
     Additionally, in an effort to conceal the fraud from the company s auditor,
     Safronchik rented postal boxes throughout the southwestern United States
     and used them as mail drops to send and receive bogus audit confirmations
     of the company s phony sales.  The Complaint also alleged that Safronchik
     fraudulently signed the audit confirmations falsely confirming the phony
     sales and returned them to the auditor.  

     The Commission s Complaint charged Safronchik with violations of  Sections
     5(a), 5(c) and 17(a) of the Securities Act of 1933 ( Securities Act ),
     Sections 10(b),  13(a), 13(b)(2)(A), 13(b)(2)(B) and 13(b)(5) of the
     Securities Exchange Act of 1934 ( Exchange Act ) and Rules 10b-5, 12b-20,
     13a-1, 13a-11, 13a-13, 13b2-1 and 13b2-2, thereunder.  Adamo was charged
     with violations of Sections 5(a), 5(c) and 17(a) of the Securities Act,
     Sections 10(b) and 13(a) of the Exchange Act and Rules 10b-5, 12b-20,
     13a-1, 13a-11, 13a-13 and 13b2-2, thereunder.  Roy was charged with
     violations of Section 17(a) of the Securities Act, Sections 10(b) and
     13(b)(5) of the Exchange Act and Rules 10b-5, 13b2-1 and 13b2-2,
     thereunder.  Simultaneously with the filing of the Complaint, Safronchik, 
     Adamo and Roy consented, without admitting or denying the allegations in 
     the Complaint, to final judgments of permanent injunction ordering them to pay
     disgorgement but waiving payment of disgorgement based upon their demonstrated
     inability to pay.  Safronchik and Adamo were also barred from serving as officers 
     or directors of any public company.  United States v. Paul R. Safronchik, 
     Jerome A. Adamo, and Douglas A. Roy, Civil Action No. SACV 98-416-LHM (EEx).


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     In a related criminal prosecution by the U.S. Attorney in Los Angeles, 
     on December 9, 1996, Safronchik pleaded guilty to conspiracy to commit securities 
     fraud, bank fraud and securities fraud.  On February 4, 1998, Adamo pleaded guilty 
     to insider trading and was sentenced to serve six months of home detention, two 
     years probation and to pay a $50,000 fine.  On September 15, 1997, Roy pleaded 
     guilty to conspiracy to commit securities fraud.  Safronchik and Roy have not yet
     been sentenced. 

















































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