SECURITIES AND EXCHANGE COMMISSION
                                  Washington, D.C. 

     LITIGATION RELEASE NO. 15419 / July 24, 1997 

     ACCOUNTING AND AUDITING ENFORCEMENT 
     RELEASE NO. 940 / July 24, 1997

     SECURITIES AND EXCHANGE COMMISSION v. ALEXANDRA ELIZABETH MONTGOMERY,
     WILLIAM KENNETH NESTOR, FREDERICK BURGESS AND HARRIET GLUCK, Civil Action
     No. CV 97 4219 (E.D.N.Y.)

          On July 24, 1997, the Securities and Exchange Commission filed a civil
     complaint in the United States District Court for the Eastern District of
     New York against Alexandra Elizabeth Montgomery, the former executive vice
     president, chief financial officer and a director of International Nesmont
     Industrial Corporation; William Kenneth Nestor, the former president, chief
     executive officer and chairman of the board of Nesmont; Frederick Burgess,
     the former head assayer and a director of Nesmont; and Harriet Gluck,
     Montgomery's mother.  Nesmont is a Canadian refiner and processor of
     precious metals whose stock traded on Nasdaq from May 1993 until it was
     delisted in August 1994.  

          The complaint alleges that from late 1992 until mid-1994, Montgomery,
     Nestor and Burgess, while officers and/or directors of Nesmont, engaged in
     a deliberate scheme to overstate the company's income and inflate its
     reported assets by including in inventory fake gold materials, including
     brass bars made up to look like gold bars.  The fraudulent scheme involved
     fabricating inventory, creating phony documents, falsifying assets and
     earnings, and making false representations in press releases and materials
     filed with the Commission.  For example, Nesmont reported net earnings of
     $219,923 (Cdn) in its audited financial statements for the year ended
     December 31, 1992, when it should have reported a net loss of $1,656,836
     (Cdn).  In its unaudited financial report for the year ended December 31,
     1993, Nesmont reported net earnings of $751,592 (Cdn), when it should have
     reported a net loss of $4,047,726 (Cdn). 
          The complaint alleges that Montgomery, Nestor and Burgess violated the
     antifraud and books and records provisions of the federal securities laws. 
     In addition, the complaint alleges that Montgomery, Nestor and Burgess
     knowingly circumvented Nesmont's system of internal accounting controls
     and, in the case of Montgomery and Burgess, knowingly falsified or caused
     to be falsified Nesmont's books, records and accounts.  The complaint
     further alleges that Montgomery and Burgess made materially false and
     misleading statements to Nesmont's independent auditors and, in the case of
     Montgomery, lied to Nesmont's controller, thereby causing him to generate
     false financial statements.  The complaint also alleges that Montgomery,
     Nestor and Burgess aided and abetted Nesmont's reporting violations by
     making material misstatements and omissions in annual and periodic reports
     filed with the Commission.

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          The complaint further alleges that Montgomery and her mother, Gluck,
     violated the antifraud provisions of the federal securities laws by
     engaging in insider trading in Nesmont stock from June 10, 1994 through
     June 23, 1994, while the investing public was unaware of the inventory
     fraud.  During that period, 59,200 shares of Nesmont stock were sold from
     Gluck's accounts, netting total proceeds of approximately $297,200 (U.S.). 
     After Nesmont's new management disclosed the inventory fraud in August
     1994, and the stock was delisted from Nasdaq, the stock became virtually
     worthless.  As a result, Gluck and/or Montgomery avoided losses of
     approximately $282,400 (U.S.) by selling Nesmont stock while in possession
     of material non-public information.

          The Commission seeks a permanent injunction enjoining Montgomery,
     Nestor and Burgess from violating Sections 10(b) and 13(b)(5) of the
     Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder;
     enjoining Montgomery and Burgess from violating Rules 13b2-1 and 13b2-2
     under the Exchange Act; enjoining Montgomery, Nestor and Burgess from
     aiding and abetting violations of Section 13(a) of the Exchange Act and
     Rules 13a-1 and 13a-16 thereunder.  Additionally, the Commission seeks an
     order for payment of civil penalties from Montgomery, Nestor and Burgess
     and an order barring Montgomery and Nestor from serving as officers and
     directors of any public company.

          The Commission also seeks a permanent injunction enjoining Montgomery
     and Gluck from violating Section 10(b) of the Exchange Act and Rule 10b-5
     thereunder, payment of insider trading penalties from Montgomery and Gluck
     and an order requiring disgorgement of losses avoided by Gluck and/or
     Montgomery from the sale of Nesmont stock.

          The Commission wishes to thank the British Columbia Securities
     Commission and the Royal Canadian Mounted Police for their assistance in
     this investigation.  

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