UNITED STATES SECURITIES AND EXCHANGE COMMISSION

 Litigation Release No. 16153 / May 19, 1999

 SECURITIES AND EXCHANGE COMMISSION v. MARSHALL NEIL CRAIG RONALD, RUDOLF ALEXANDER VICTOR LINSCHOTEN A/K/A RUDOLF VAN LIN OR DR. RUDOLF VAN LIN, AND FRIEDA G. FREITAS, Civil Action No. 98-866 AHS (EEx) (C.D. Cal.).

 The Securities and Exchange Commission announced today that the United States District Court for the Central District of California entered a Final Judgment of Permanent Injunction and Other Relief ("Final Judgment") against Frieda G. Freitas ("Freitas") on April 26, 1999, for her involvement in an illegal "prime bank" scheme. The Final Judgment, entered pursuant to Freitas’ consent, requires her to pay $15,000 in disgorgement, plus prejudgment interest. She is also enjoined from violating the registration and anti-fraud provisions of the federal securities laws, namely Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.

 The Commission’s lawsuit was filed in Los Angeles on September 16, 1998, and named Freitas and two other defendants, Marshall Neil Craig Ronald ("Ronald") and Rudolf Alexander Victor Linschoten ("Linschoten"). On May 10, 1999, the Court entered default judgments against Ronald and Linschoten and ordered them to pay almost $6 million in disgorgement, plus prejudgment interest. From December 1996 through October 1997, the defendants raised over $6 million from approximately 170 investors who believed they were investing in a "bank trading" program. The Commission’s complaint alleged that the defendants told investors that their funds would be used for a secret "bank trading" program and guaranteed a 100% return within 90 "banking days" in a "risk free" investment. In fact, there was no bank trading program; Ronald used investor funds to purchase cars, guns, residential property, and to pay credit card and hotel bills. Investor funds were also transferred to Linschoten’s Swiss bank account. Freitas was the administrative coordinator and point of contact for the "bank trading" program.

 These type of frauds are commonly referred to as "prime bank" schemes and have been the subject of repeated warnings by several federal agencies, including the Commission, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of Comptroller of the Currency, the Office of Thrift Supervision and the National Credit Union Administration.