SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 RELEASE NO. 38913 / August 11, 1997 ADMINISTRATIVE PROCEEDING FILE NO. 3-9357 ADMINISTRATIVE PROCEEDINGS INSTITUTED AGAINST H. BECK, INC. AND GARY S. HURVITZ The Securities and Exchange Commission announced that public administrative proceedings have been instituted pursuant to Sections 15(b) and 19(h) of the Securities Exchange Act of 1934 ("Exchange Act") against H. Beck, Inc. ("H. Beck"), a registered broker-dealer whose principal place of business is Rockville, Maryland, and Gary S. Hurvitz ("Hurvitz"), age 44, President, Chief Executive Officer, Chief Operating Officer, Chief Legal Officer, Chief Compliance Officer and an owner and director of H. Beck. The order instituting proceedings ("Order") alleges that from May 1990 through at least November 1994, Joseph P. Medsker ("Medsker"), an H. Beck registered representative located in an independently owned and operated one-person office in Dayton, Ohio, engaged in a scheme to defraud H. Beck customers in violation of Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 ("Securities Act"), Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder and Sections 203(a), 206(1), 206(2) and 206(4) of the Investment Advisers Act of 1940 ("Advisers Act") and Rule 206(4)-4 thereunder. The Order further alleges that in furtherance of his scheme Medsker, among other things, offered and sold unregistered partnership interests, misrepresented and omitted to state material facts in connection with the offer and sale of those interests, churned the account of an H. Beck customer and attempted to cover up the scheme by sending misleading statements and updates to investors. The Order alleges that H. Beck and Hurvitz failed reasonably to supervise Medsker with a view toward preventing his securities law violations described above, by: failing to implement a system reasonably designed to prevent and detect his violations; failing to adequately monitor his day-to-day activities; and failing to take adequate action in response to certain red flags regarding Medsker's conduct of which they had notice. A public hearing will be scheduled by further order to take evidence on the allegations and to afford H. Beck and Hurvitz an opportunity to offer any defense thereto, for the purposes of determining what remedial action, if any, including civil penalties, should be ordered by the Commission against them. ======END OF PAGE 1======