United States Attorney
Northern District of Texas

1100 Commerce St., 3rd Fl.
Dallas, Texas 75242-1699

Telephone (214) 659-8600
Fax (214) 767-0978

FATHER/SON BUSINESSMEN PLEAD GUILTY TO FEDERAL CONSPIRACY CHARGE

Dale Sterritt Sentenced to 5 Years Imprisonment
Dick Sterritt to be Sentenced Next Month

United States Attorney Jane J. Boyle announced today that Richard Dale (Dale) Sterritt Jr., age 47, of Plano, Texas, was sentenced Friday by the Honorable United States District Judge Sidney A. Fitzwater to serve 60 months imprisonment and ordered to pay $13,069,425.00 in restitution following his April 2003 guilty plea to conspiracy to commit securities fraud, money laundering and filing false income tax returns. These charges and others were outlined in a 7-count superseding indictment returned by a federal grand jury in July 2002. A federal grand jury also returned a separate, but related 48-count indictment in December 2002 against Richard Dale Sterritt Jr., his father, Richard Dale (Dick) Sterritt, Sr., of Garland, Texas, Plano lawyer Edward Wesley Roush, and Lubbock, Texas, resident Susan Lale, alleging additional similar and related offenses. Richard Dale Sterritt Jr. has been in custody since that time.

Richard Dale Sterritt, Sr., age 71, pled guilty to the same charge as his son in April 2003 and is scheduled to be sentenced on October 24, 2003 by Judge Fitzwater. He has been on bond since the June 2002 indictment. In accordance with the plea agreement filed with the Court, the 48-count indictment returned in December 2002 was dismissed at sentencing as to Richard Dale Sterritt, Jr., and the government will move to dismiss the same indictment against Sterritt, Sr. when he is sentenced in October. The jury trial for defendants Edward Wesley Roush and Susan Lale is set for February 9, 2004 before the Honorable United States Senior District Judge Barefoot Sanders.

From July 1991 to the beginning of September 1998, Richard Dale Sterritt, Jr. was Chairman of the Board of Directors, President, and Chief Executive Officer of Continental Investment Corporation (CIC). Although Continental was headquartered in Dallas, it was incorporated in Atlanta, Georgia, and its principal asset was a granite quarry and surrounding property in Atlanta. CIC's common stock was traded over the counter on the National Association of Securities Dealers' Bulletin Board Pink Sheets System. Richard Dale Sterritt, Sr. owned substantial amounts of CIC stock.

The Sterritts admitted that they conspired together, and with Fred Royer, to manipulate CIC's stock price. Royer was a licensed securities broker-dealer and was the President and CEO of another closely-held company controlled by the Sterritts. Royer pled guilty to his role in the scheme and was sentenced this month to three years probation. The Sterritts made it appear that the stock was in demand by transferring stock between CIC and other entities, including Crescent Capital Corporation and Swan Financial Services Corporation, which they represented to be controlled by third parties. However, the Sterritts admitted that they exercised influence and control over Crescent and Swan even though they had arranged for the ownership of those entities to be placed in trusts in the names of relatives or close friends.

The Sterritts admitted that they well knew that by transferring stock among companies they controlled and influenced, that the CIC stock would appear to be in demand or the value of CIC assets would be inflated, thereby artificially raising the stock price. The Sterritts admitted that as a result of their actions, individual investors purchased CIC stock at inflated prices.

United States Attorney Boyle praised the collaborative investigative efforts of the Internal Revenue Service, Criminal Investigation (IRS-CI) and the Federal Bureau of Investigation. The cases are being prosecuted by Assistant United States Attorney Mike Snipes.

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