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House Asset Management, L.L.C, House Edge, L.P., Paul J. House, and Brandon R. Moore


U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 19352 / August 30, 2005

SEC V. House Asset Management, L.L.C, House Edge, L.P., Paul J. House, and Brandon R. Moore, U.S. District Court for C.D. Ill., Civil Action No. 02-2147 (Bernthal, J.)

On August 22, 2005, the U.S. District Court for the Central District of Illinois, with the consent of defendants House Asset Management, L.L.C. ("House Asset Management") and House Edge, L.P. ("House Edge"), entered a final judgment against these defendants under which they are ordered jointly and severally liable for $2,914,796 in disgorgement and $270,870 in prejudgment interest. Payment of all but $1,375,767 of this amount was waived and the Court did not impose a civil penalty against House Asset Management and House Edge, based upon the sworn representations made by the Court-appointed Receiver for these defendants ("Receiver") in his final accounting. Prior to the entry of this final judgment, the Receiver marshaled assets over which the receivership had a claim and distributed $1,375,767 to House Edge investors. The August 22, 2005 final judgment resolves all remaining issues against House Edge and House Asset Management. On June 20, 2002, the Court, with the consent of House Edge and House Asset Management, enjoined these defendants from violating Section 5(a) and 5(c) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. Furthermore, with the consent of the defendants, the June 20, 2002 order enjoined House Edge from violating Section 7(a) of the Investment Company Act of 1940 and House Asset Management from violating Sections 206(1) and 206(2) of the Investment Advisers Act of 1940.

The Commission alleged in its complaint that House Edge, a purported hedge fund, and House Asset Management, the adviser to House Edge, conducted a fraudulent offering that raised approximately $2.9 million from investors. The Commission further alleged that defendants, Paul J. House and Brandon R. Moore, the two individuals primarily responsible for the offering of units in House Edge, made false statements concerning House Edge's historical returns as well as the use of investor proceeds. Additional details concerning the factual allegations and the violations charged against the defendants in the Commission's complaint, and the relief previously obtained by the Commission against defendants in this action, can be found in Litigation Releases 17583 / June 24, 2002 and 18892 / September 22, 2004.