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                     United States of America
                           Before the 
                Securities and Exchange Commission


SECURITIES ACT OF 1933
Release No.  7309 / June 28, 1996

SECURITIES EXCHANGE ACT OF 1934
Release No. 37386 / June 28, 1996

Administrative Release No. 3-9034

COMMISSION INSTITUTES ADMINISTRATIVE PROCEEDINGS AGAINST J.
STEPHEN STOUT FOR FRAUDULENT SALES PRACTICES AND AGAINST ALFRED
BAUER FOR FAILING REASONABLY TO SUPERVISE

The Securities and Exchange Commission today announced the
institution of administrative proceedings against J. Stephen
Stout, a registered representative, and Alfred Bauer, a resident
manager, formerly employed in the Flint, Michigan branch office
of PaineWebber Incorporated. 

The order alleges that Stout engaged in numerous fraudulent sales
practices, including making unsuitable recommendations of
securities; distributing false portfolio valuations that induced
customers to buy additional securities; and engaging in the
unauthorized purchase of securities.

The order alleges that Bauer failed reasonably to supervise Stout
by failing to adequately monitor outgoing mail to prevent Stout
from sending out false valuations, signing and approving the
mailing of one false account valuation without verifying its
accuracy, and failing to conduct adequate quarterly portfolio
reviews of Stout's customers.

     A public hearing will be held to determine whether the
allegations included in the Order are true, to offer Stout and
Bauer an opportunity to establish any defenses to the
allegations, and to determine what remedial sanctions, if any,
are appropriate.