SEC v. First Jersey Securities, Inc., et al.

This Notice is to advise you of the distribution plan (the "Distribution Plan") approved by the United States District Court for the Southern District of New York (the "District Court") on July 2, 2004, and what you need to do to share in the funds collected from Brennan and First Jersey and made available under the Distribution Plan (the "Disgorged Funds"). To date, the Securities and Exchange Commission ("SEC") has collected $26,805,773 as a result of the following:

1. On October 31, 1985, the SEC sued Brennan and First Jersey for civil violations of the federal securities laws and sought a judgment for ill-gotten gains arising from a massive securities fraud. On July 18, 1995, after a trial, the District Court found Brennan and First Jersey liable to pay $74,977,993 in disgorgement and prejudgment interest. The judgment was affirmed by the United States Court of Appeals for the Second Circuit on December 10, 1996.
2. On August 7, 1995, Brennan and First Jersey filed for protection under Chapter 11 of the United States Bankruptcy Code in the District of New Jersey. At the SEC’s request, the bankruptcy court appointed trustees to administer their bankruptcy cases.
3. On April 16, 2001, Brennan was convicted of bankruptcy fraud and money laundering and was sentenced to 110 months of incarceration in a federal prison.
4. To date, the SEC has collected $26,805,773 from Brennan’s bankruptcy estate and other sources in partial payment of its judgment against Brennan and First Jersey.
5. On July 2, 2004, the District Court approved the Distribution Plan proposed by the SEC to compensate, in part, the victims of Brennan’s and First Jersey’s fraud. The Disgorged Funds will be distributed according to a formula approved by the District Court to compensate eligible investors who invested in the securities listed in Schedule "A" to this notice.

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