SECURITIES AND EXCHANGE COMMISSION Washington, D.C. SECURITIES EXCHANGE ACT OF 1934 Rel. No. 40055 / JUNE 2, 1998 Admin. Proc. File No. 3-8798 : In the Matter of : : TERRY T. STEEN : : OPINION OF THE COMMISSION BROKER-DEALER PROCEEDING Ground for Remedial Action Sale of Unregistered Securities Registered representative of a registered broker-dealer sold unregistered securities in violation of the securities laws. Held, it is in the public interest to suspend representative from associating with a broker or dealer or member of a national securities exchange or a registered securities association for six months and to order respondent to cease and desist from committing or causing any violation of Section 5(a) or Section 5(c) of the Securities Act of 1933. The proceeding is remanded for further consideration of respondent's ability to pay disgorgement. APPEARANCES: Daniel F. Wake, of Krendl Horowitz & Krendl, for Terry T. Steen. Thomas D. Carter and Polly Atkinson, for the Division of Enforcement. Appeal filed: March 28, 1997 Last brief received: August 20, 1997 I. Terry T. Steen, who during the relevant time period was a registered representative with Rocky Mountain Securities & Investments, Inc. ("RMS"), a registered broker-dealer, appeals from a decision of an administrative law judge. The law judge found that Steen violated Sections 5(a) and 5(c) ======END OF PAGE 1====== of the Securities Act of 1933 ("Securities Act") <(1)> by selling shares of unregistered common stock in Stat-Tech International Corporation ("Stat-Tech"). The law judge suspended Steen from association with any broker, dealer, or member of a national securities exchange or of a registered securities association for a period of six months; required Steen to disgorge $68,068.40 plus prejudgment interest; and ordered Steen to cease and desist from committing or causing violations or future violations of Sections 5(a) and 5(c). We base our findings on an independent review of the record, except with respect to those findings below not challenged on appeal. II. Sections 5(a) and 5(c) of the Securities Act make it unlawful for any person to sell, or offer to sell, an unregistered security in the absence of an exemption from registration. Steen does not dispute that he sold Stat-Tech securities without a registration statement through the jurisdictional means. He further does not claim on appeal that an exemption from registration was available. Thus, the facts on appeal are not in dispute. We discuss them in some detail because Steen claims that the suspension imposed by the law judge is not in the public interest. Steen began his career in the securities industry in 1975 and became a registered representative of RMS in 1983. RMS hired Steen as an independent contractor and permitted Steen to maintain a personal trading account at the firm. Steen's contract with RMS apportioned 80% of the proceeds from profitable transactions to Steen with the remaining 20% going to RMS. Steen was responsible for all losses from his trading. Stat-Tech, a blind pool corporation, <(1)> was formed in 1988 when its predecessor, Static Buster Inc., merged with Gleneagle Capital Corporation. Stat-Tech became a reporting company as a result of the merger and subsequently filed a registration statement on Form 8-A to register its common stock pursuant to Section 12(g) of the Securities Exchange Act of 1934 ("Exchange Act"). However, Stat-Tech never registered <(1)>/ See Securities Act, Sections 5(a) and (c), 15 U.S.C.  77(e) (1997). <(1)>/ A blind pool corporation does not have current operations. It is organized to evaluate and effectuate mergers with or acquisitions of other companies (or acquisitions of assets) that are as yet unidentified. See, e.g., Robert A. Amato, 51 S.E.C. 316, 317 n.5 (1993), aff'd, 18 F.3d 1281 (5th Cir. 1994), cert. denied, 513 U.S. 928 (1995). ======END OF PAGE 2====== its securities under the Securities Act. <(1)> Steen first heard of Stat-Tech in January 1989 when he attended a "due diligence" meeting. During the meeting, Steen met Ray Fenster, President and Chief Executive Officer of Stat-Tech, and two of the corporation's directors, Hayden Thompson and Melvin Takaki. At around the same time, Steen also received an annual report on Form 10-K and what Steen described as a "prospectus" for Stat-Tech. <(1)> The Form 10-K disclosed Stat- Tech's management structure. Stat-Tech's Form 10-K for the year ending September 30, 1989 further disclosed that Stat-Tech's directors and officers owned 98,368,000 shares in the company, approximately 77% of the outstanding shares. RMS subsequently received Stat-Tech's articles of incorporation, which provided, "All of the shares of Stat-Tech delivered to the shareholders of Static Buster are not registered under any federal or state securities laws and shall be considered restricted stock as that term is defined by Rule 144 promulgated under the Securities Act of 1933, as amended." Steen never reviewed this document even though it was readily available to him at RMS. In March 1989, Steen asked RMS to act as market maker for Stat-Tech stock and provided "10-K's" <(1)> and the "prospectus" to the firm. Steen sought and received approval from RMS to trade Stat-Tech stock. We have previously observed that "when a dealer is offered a substantial block of a little-known security . . . where the surrounding circumstances raise a question as to whether or not the ostensible sellers may be . . . statutory underwriters, then searching inquiry is called <(1)>/ Except for securities exempt under Securities Act Sections 3(a)(2) - (8), which are inapplicable here, the determination of whether offers and sales are required to be registered depends on an analysis of the transaction. The fact that the common stock of Stat-Tech securities was registered under the Exchange Act did not satisfy the requirement that the subject transactions be registered under the Securities Act or be exempt from such registration. See, e.g., Allison v. Ticor Title Ins. Co., 907 F.2d 645, 648 (7th Cir. 1990). <(1)>/ Although the record contains a Form 10-K for the fiscal year ending September 30, 1989, it is unclear which year's Form 10-K Steen received in January 1989. <(1)>/ The record does not identify the dates of these Forms 10-K. ======END OF PAGE 3====== for." <(1)> As described infra, Steen failed to fulfill this obligation. Rule 144 defines "affiliate" as a "person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with" the issuer of a security. <(1)> From 1989 to 1991, Steen opened four accounts at RMS for persons who were, or who had acquired stock from, Stat-Tech affiliates. Through his trading account, Steen sold approximately 8.8 million of the corporation's shares on their behalf to members of the investing public. Rule 144 permits affiliates of an issuer to sell that company's securities only upon the satisfaction of certain conditions. It further imposes conditions on any person selling restricted securities, as defined in Rule 144(a). Rule 144(a)(3) defines "restricted securities" to include securities acquired from the issuer or an affiliate in a transaction not involving a public offering. <(1)> At the time of the events at issue, a seller was required to hold the restricted securities for two years before a resale. <(1)> An affiliate is also limited in the amount of shares that may be sold. <(1)> Furthermore, notice of a proposed sale must be given if sales during a three-month period exceed 500 shares or the aggregate sum of $10,000. <(1)> Steen's sales on behalf of these clients violated one or more of these conditions. Consequently, the transactions (described in detail below) did not qualify for Rule 144 treatment. <(1)>/ Distribution by Broker-Dealers of Unregistered Securities, Securities Act Release No. 4445 (Feb. 2, 1962). See also Protective Group Securities Corporation, 51 S.E.C. 1233, 1237 n.17 (1994), quoting Securities Act Release No. 5223 (Jan. 11, 1972) (Rule 144 adopting release which puts persons who sell restricted securities without registration "on notice [of substantial burden of proof] in view of broad remedial purposes of the Securities Act and of public policy which supports registration"); V.F. Minton Securities, Inc., 51 S.E.C. 346, 351-53, n.28 (1993), aff'd, 18 F.3d 937 (5th Cir. 1994) (Table). <(1)>/ 17 C.F.R.  230.144(a)(1). RMS' compliance manual further explained, "Controlling persons of a corporation are usually: officers, directors." <(1)>/ 17 C.F.R.  230.144(a)(3). <(1)>/ Formerly 17 C.F.R.  230.144(d), superseded by 62 Fed. Reg. 9244 (1997). <(1)>/ 17 C.F.R.  230.144(e)(1). <(1)>/ 17 C.F.R.  230.144(h). ======END OF PAGE 4====== A. Therese Lamb, a Steen client, was married to Fenster, Stat- Tech's president and CEO. <(1)> Lamb was also Stat-Tech's secretary and treasurer. From July 1989 to July 1990, in over 14 separate transactions, Steen sold 4.8 million shares of Lamb's Stat-Tech stock through his trading account at RMS. Steen claimed that he effected these sales without realizing that Lamb was a Stat-Tech affiliate. However, Stat-Tech's Form 10-K for the year ending September 30, 1989, which Steen had in his files, disclosed that Lamb held two separate positions as an officer of Stat-Tech and was, in addition, married to Fenster. Steen's files also contained a Standard & Poor's listing, which Steen testified he had "seen," identifying Lamb as Stat-Tech's corporate secretary. Steen had ample indication that sales of these securities violated Section 5 of the Securities Act. As a RMS registered representative, Steen prepared new account forms for his clients. Although an earlier account form for Lamb dated August 1989 did not reveal her affiliation with Fenster or Stat-Tech, Steen identified Lamb as a relative of a control person at Stat-Tech on a new account form dated January 18, 1990. As described above, Steen had information indicating that Lamb was a Stat-Tech affiliate, as well as the spouse of an affiliate. In addition, he had the company's public filings that made clear that Stat-Tech affiliates controlled over 3/4 of the outstanding shares. Steen also had access to the certificate of merger that made clear that shares received by the former shareholders of Static Busters, Inc. were restricted. However, Steen never asked Lamb how she obtained her stock or examined her stock certificate. <(1)> Nor did he inquire about her relationship with Fenster or other Stat-Tech affiliates to determine whether, among other things, Lamb's activities were part of an unlawful distribution of unregistered securities. <(1)> B. In 1989 and 1990, Steen unlawfully sold 300,000 shares of Stat- Tech stock for Takaki. Steen knew Takaki was a director of the corporation when he effected these sales. The Form 10-K listed Takaki as a Stat-Tech <(1)>/ Among other things, Rule 144(a)(2)(i) includes in the term "person" any person who sells securities under the rule, as well as his or her spouse if they share a home. The sales of the seller are aggregated with any sales by the spouse. Rule 144 also provides that, if two or more affiliates or other persons act in concert, their sales are aggregated for purposes of the rule. Securities Act Release No. 6099 (Aug. 2, 1979), 44 Fed. Reg. 46,752 (1979). <(1)>/ The stock certificates were signed by Therese Lamb as Stat-Tech's secretary. <(1)>/ Steen possessed RMS' compliance manual, which directed that these types of inquiries should be made by the registered representative. ======END OF PAGE 5====== director, and Takaki was introduced to Steen as a company director at the due diligence meeting. Although Takaki, as a Stat-Tech director, was an affiliate, Steen claimed before the law judge that he assumed Takaki held free-trading, unrestricted, Stat-Tech stock. Again, Steen failed to make the required inquiries. Steen did not ask Takaki how he had obtained his Stat-Tech shares, or seek other evidence to support his assumption that the stock was not restricted. Moreover, even if Takaki had held stock that was not restricted, as an affiliate, his transactions at that time were subject to the limitation on the amount of securities that could be sold, as well as Rule 144's notice requirements. Steen sold 150,000 shares on Takaki's behalf in August 1989 and a second block of 150,000 shares in August 1990. C. In August 1991, Steen opened an account at RMS for Delaware Technology Corporation ("DTech"), a Delaware company incorporated in 1990. Fenster referred DTech to Steen, and DTech's new account form listed Stat- Tech as the source of the referral. DTech had in fact acquired 10 million shares of Stat-Tech stock from Fenster. Fenster, in turn, served as a director and vice president of DTech. <(1)> Lamb was a DTech director and its secretary. At the request of DTech's president, Russell Price, Steen sold more than 1.7 million shares of DTech's Stat-Tech stock over three days in 1991. Steen did not ask Price for proof of his authority to trade on DTech's behalf or the names of DTech's other officers and directors, nor did Steen inquire about how or from whom DTech had acquired the Stat-Tech stock. Thus, he did not discover that DTech had acquired its stock from Fenster, a Stat-Tech affiliate. Moreover, had Steen obtained the corporate resolution authorizing Price to make trades for DTech in August 1991 (when two of the three transactions involving DTech's Stat-Tech shares occurred), Steen would have discovered that Lamb was the secretary and a director of DTech - - a further indication that DTech's possession of Stat-Tech stock might be part of an attempt to distribute unregistered Stat-Tech stock. D. In August 1991, Steen also sold 1.3 million shares of Stat-Tech stock for Thompson, who, as Steen knew, was a director of the corporation. Thompson, who had acquired these shares in 1990, told Steen that the stock was restricted and subject to Rule 144. Although Steen informed the compliance department at RMS that the sale would be subject to Rule 144, he did not take any action to achieve compliance with the rule. * * * Based on the record described above, we concur with the law judge that Steen wilfully violated Sections 5(a) and 5(c) of the Securities Act. III. <(1)>/ Fenster also paid the fees involved in incorporating DTech, provided the funds for DTech's bank account, and loaned DTech money to purchase an airplane and the Pueblo Press Building where Stat-Tech was located. ======END OF PAGE 6====== Steen asserts that a six-month suspension is excessive and contends that a three-month term would better serve the public interest. Steen notes initially that, in Johnson v. SEC, 87 F.3d 484 (D.C. Cir. 1996), the United States Court of Appeals for the District of Columbia Circuit held that the five-year statute of limitations in 28 U.S.C.  2462 prohibited this Commission from imposing a censure or a suspension on a securities industry supervisor where the entirety of the supervisor's allegedly wrongful conduct occurred five years prior to the commencement of administrative proceedings against her. Steen contends that 28 U.S.C.  2462 bars consideration of the Lamb and Takaki sales, which occurred in 1989 and 1990, in determining the appropriate term of the suspension because these proceedings were commenced by an Order Instituting Proceedings dated September 6, 1995, more than five years after the Lamb and Takaki transactions. However, we and the law judge are entitled to consider events that occurred in 1989 and 1990, where relevant, to establish Respondent's motive, intent, or knowledge in the commission of the 1991 and 1992 violations. <(1)> Although Steen does not dispute the violations on appeal to us, he argued before the law judge that he had met his duty of inquiry with respect to DTech and Thompson. Since the earlier transactions by Stat-Tech affiliates and the relationships among Fenster, Lamb, Takaki, DTech, and Thompson would be relevant to the level of Steen's awareness about the propriety of the subsequent transactions, the evidence relating to the early transactions was properly considered by the law judge. Moreover, the Court in Johnson held that "where the effect of the SEC's action is to restore the status quo ante, such as through a proceeding for restitution or disgorgement of ill-gotten profits,  2462 will not apply." <(1)> All of Steen's transactions with Stat-Tech affiliates are properly considered to assess the amount of disgorgement. That disgorgement amount, $60,068.40 plus interest, reflects Steen's gains from the violative trades. Even if we were barred from considering the pre-September 1990 <(1)>/ See, e.g., H.P. Lambert Co., Inc. v. Secretary of the Treasury, 354 F.2d 819, 822 (1st Cir. 1965) (in a proceeding revoking customhouse broker's license instituted in 1964 and alleging violations as early as 1951, court suggests that the Secretary "could have found the misconduct that occurred during the five-year period, standing alone, to warrant his order, and . . . might properly have considered misconduct prior to that time to whatever extent it cast light upon the culpability of the activity during the legal period"); see also Fed. R. Evid. 404(b). <(1)>/ Johnson, 87 F.3d at 491, citing SEC v. Lorin, 869 F. Supp. 1117, 1122-23 (S.D.N.Y. 1994); SEC v. Bilzerian, 29 F.3d 689, 696 (D.C. Cir. 1994); SEC v. First City Financial Corp., 890 F.2d 1215, 1231 (D.C. Cir. 1989). ======END OF PAGE 7====== transactions for purposes of determining what sanction is in the public interest, however, Steen's wrongful conduct in 1991 and 1992 supports imposition of a six-month suspension. In considering whether an administrative sanction serves the public interest, we evaluate the egregiousness of a respondent's actions, the isolated or recurrent nature of the violation, the degree of scienter, the sincerity of a respondent's assurances against future violations, the respondent's recognition that the conduct was wrongful, and the likelihood of recurring violations. <(1)> As a securities professional, and as a "person dealing closely with the investing public," Steen was "expected to secure compliance with the requirements of the [Securities] Act to protect the public from illegal offerings." <(1)> The record reflects that Steen failed to conduct even the most basic inquiry to ascertain whether the trades on behalf of DTech and Thompson complied with the securities laws. Steen did not inquire about the corporate structure of DTech or its relationship to Stat-Tech although he knew the company had been referred to him by Stat-Tech. He made no attempt to determine the source of DTech's Stat-Tech shares. Furthermore, Steen assumed that DTech's president had the requisite trading authority. As noted above, Steen did not examine that authorization, which indicated Lamb's relationship to DTech. Moreover, Steen knew as early as 1989 that Thompson was a director of Stat-Tech, and Thompson had told Steen that his shares were restricted. However, apart from informing the RMS compliance department that the sale of Thompson's stock should be processed under Rule 144, Steen made little or no effort to determine how long Thompson had held the shares which were sold in 1991. Thus, Steen failed to heed and observe the numerous red flags that would have alerted him to the impropriety of trading the unregistered Stat- Tech shares. These violations were neither isolated nor insignificant. Steen traded for DTech and Thompson, within the five-year limitations period, approximately 3 million shares of Stat-Tech stock that had not been registered under the Securities Act. In August 1991 alone, Steen sold over 2 million shares of unregistered Stat-Tech stock in three separate transactions on behalf of DTech and Thompson. Steen asserts that he has not contested the allegations on appeal. Yet before us he again attempts to shift responsibility for the wrongful trades on behalf of DTech and Thompson to RMS' compliance department. Steen should have conducted his own inquiry into whether DTech and Thompson were affiliates and investigated the propriety of the trades he made on <(1)>/ Steadman v. SEC, 603 F.2d 1126, 1140 (5th Cir. 1979), aff'd, 450 U.S. 91 (1981). <(1)>/ Quinn and Company, Inc. v. SEC, 452 F.2d 943, 946 (10th Cir. 1971), cert. denied, 406 U.S. 957 (1972). ======END OF PAGE 8====== their behalf. We thus question Steen's assurances that he recognizes the wrongful nature of his conduct. Steen argues that other considerations, such as his subsequent divorce, loss of customers, and bankruptcy, support a reduction in the recommended suspension. He also notes that his disciplinary record was marred by only one prior infraction. <(1)> Steen also claims that he now limits his activities to securities listed on an exchange or quoted on Nasdaq. However, as a result of Steen's conduct, members of the public purchased unregistered securities. Steen represents that he is abiding by a self-imposed limit of trading only listed securities. We do not agree that this restriction would necessarily prevent future violations of the type alleged here. Securities in the hands of affiliates are subject to the provisions of Rule 144, regardless of whether the security is listed on an exchange or quoted on Nasdaq. Consequently, Steen's voluntary restriction to these types of securities does not necessarily decrease the likelihood of recurring violations. Based on the factors discussed above, we conclude that a six-month suspension serves the public interest. <(1)> IV. Steen contends that he should not be required to disgorge the amount plus interest ordered by the law judge because he does not have the ability to pay. Steen notes that he was discharged in bankruptcy proceedings in 1995 and contends that the fact of his bankruptcy conclusively proves that he lacks the resources to pay disgorgement. Moreover, for the first time in these proceedings, Steen offers sworn financial documents purporting to document his current inability to pay. <(1)> <(1)>/ In 1982, the State of Colorado fined Steen $500 while he was at Dean Witter for conducting securities transactions without a state license. Steen represents that Dean Witter paid this fine. <(1)>/ Steen does not dispute the propriety of the cease and desist order. The law judge declined to impose a civil penalty citing, as mitigating factors, Steen's lack of scienter, his apparent sincerity in preventing future violations, and the adverse personal, business and financial consequences he suffered as a result of his involvement with Stat-Tech. <(1)>/ The documents include a sworn, but undated, financial statement; a 1996 Form 1099; a Form D-A representing Steen's financial condition as of June 30, 1997 and sworn to on July (continued...) ======END OF PAGE 9====== The burden of proving financial inability to pay disgorgement falls upon the respondent. <(1)> Before the law judge, Steen argued that he lacked the financial ability to pay disgorgement. He did not, however, introduce during that hearing any of the financial documents that he now presents on appeal (or any comparable financial information), except for the June 1, 1995 order discharging him from bankruptcy. <(1)> That order simply recites the fact that Steen was discharged and did not constitute sufficient evidence to demonstrate an inability to pay disgorgement. We therefore agree with the law judge that Steen failed to satisfy his burden of proof as to his inability to pay during that hearing. Our Division of Enforcement argues that Steen's failure to introduce financial statements before the law judge constitutes a waiver precluding our consideration of his ability to pay on this appeal. Rule of Practice 630(a) provides that, in a proceeding in which a disgorgement order may be entered, "a respondent may present evidence of an inability to pay" such disgorgement. Rule 630(b) provides further that any respondent who asserts an inability to pay "may be required to file a sworn financial statement." Steen notes that he was not required to file any financial statement before the law judge. Steen further contrasts the language in Rule 630(b) that a respondent "may be required to file" such information with the requirement of Rule of Practice 410(c) that a respondent who asserts on appeal of an initial decision to this Commission an inability to pay disgorgement "shall file with the opening brief a sworn financial disclosure statement containing the information specified in Rule 630(b)." He argues that, under our Rules of Practice, absent an order to submit financial information, the respondent has discretion whether to provide a financial statement before the law judge although the respondent must provide such information on appeal to us. We believe that Steen does not correctly construe the Rules of Practice. Given the respondent's burden of demonstrating inability to pay, financial information supporting that argument must be presented before the law judge. In addition, the law judge may, as our Rule indicates, require the filing of sworn financial statements. Where a respondent raises the issue of inability to pay but fails to adduce at the earliest available opportunity material evidence of his then- current financial position, Rule of Practice 452 would appear to govern the <(1)>(...continued) 3, 1997; and copies of Steen's income tax returns from 1991 to 1995. <(1)>/ See 5 U.S.C.  556. Cf., Bruce Zipper, 51 S.E.C. 928, 931 (1993) (burden on respondent to demonstrate inability to pay in NASD proceeding). <(1)>/ In re Terry Theodore Steen, No. 95-11661 (Bankr. D. Colo. June 1, 1995). ======END OF PAGE 10====== terms under which additional evidence on the same issue may be considered by the Commission. Rule 452 provides that we may, on our own motion or upon the motion of a party, allow the submission of additional evidence at any time prior to issuing a decision. However, any "[s]uch motion shall show with particularity that such additional evidence is material and that there were reasonable grounds for failure to adduce such evidence previously." <(1)> Steen has failed to make the showing required by Rule 452. Although the documents submitted by Steen on appeal are clearly material, he does not suggest any reasonable grounds for the failure to adduce comparable financial information earlier. We stress that in the future, absent compliance with the requirements of Rule 452, we may consider that a respondent who fails to introduce material evidence of inability to pay before the law judge has waived this issue. <(1)> However, since this is one of the first litigated cases dealing with imposition of disgorgement under our new Rules of Practice, and we recognize that there may be ambiguity in the Rules, we cannot conclude that a waiver occurred here. While we have reviewed Steen's submissions, we decline to decide the issue of his ability to pay disgorgement solely on the basis of these new documents. Since the Division of Enforcement has not yet examined respondent about these materials or as to the possible existence of other assets which may have become available to pay disgorgement since the conclusion of Steen's hearing, we remand the proceeding for further consideration concerning whether, as of the time of such hearing, Steen has the financial ability to pay disgorgement. An appropriate order will issue. <(1)> By the Commission (Chairman LEVITT and Commissioners JOHNSON, HUNT AND UNGER); Commissioner CAREY not participating. <(1)>/ 17 C.F.R.  201.452. <(1)>/ We recognize that a respondent's finances may change between the hearing and appeal. If a respondent suffers a substantial reverse in the interim, we would entertain an assertion of that inability to pay. Similarly, if the respondent demonstrates an inability to pay before the law judge, we would examine whether that inability continued on appeal under Rule of Practice 410(c). Here, however, Steen asserted his inability before the law judge but, as discussed, failed to introduce relevant evidence of his financial condition. <(1)>/ All of the contentions advanced by the parties have been considered. They are rejected or sustained to the extent that they are inconsistent or in accord with the views expressed herein. ======END OF PAGE 11====== Jonathan G. Katz Secretary ======END OF PAGE 12====== SECURITIES AND EXCHANGE COMMISSION Washington, D.C. Securities Exchange Act of 1934 Rel. No. Admin. Proc. File No. 3-8798 : In the Matter of : : TERRY T. STEEN : : : ORDER IMPOSING REMEDIAL SANCTIONS AND REMANDING FOR FURTHER PROCEEDINGS ON RESPONDENT'S ABILITY TO PAY DISGORGEMENT On the basis of the Commission's opinion issued this day, it is ORDERED that Terry T. Steen be, and he hereby is, suspended from association with any broker, dealer, or member of a national securities exchange or of a registered securities association for a period of six months, effective upon the opening of business on June 15, 1998; and it is further ORDERED that Terry T. Steen cease and desist from committing or causing any violation of or future violation of Sections 5(a) and 5(c) of the Securities Act of 1933; and it is further ORDERED that this matter is remanded to the law judge for further consideration of Respondent's ability to pay disgorgement as of the time of the hearing on remand, and to set the amount of disgorgement. By the Commission. Jonathan G. Katz Secretary ======END OF PAGE 13======