Craig R. Clark, CPA

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 44270 / May 7, 2001

Accounting and Auditing Enforcement
Release No. 1391 / May 7, 2001

Administrative Proceeding
File No. 3-10476

In the Matter of CRAIG R. CLARK, CPA, Respondent

: : : : : : : :

ORDER INSTITUTING PUBLIC ADMINISTRATIVE PROCEEDINGS PURSUANT TO RULE 102(e) OF THE COMMISSION'S RULES OF PRACTICE, MAKING FINDINGS, AND IMPOSING REMEDIAL SANCTIONS

I.

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted against Craig R. Clark ("Respondent" or "Clark") pursuant to Rule 102(e)(3) of the Commission's Rules of Practice.¹

II.

Clark has submitted an Offer of Settlement ("Offer") to the Commission in anticipation of the institution of this administrative proceeding. The Commission has determined that it is appropriate to accept Clark's Offer. Solely for the purposes of these proceedings and any other proceeding brought by or on behalf of the Commission, or to which the Commission is a party, and without admitting or denying the findings herein, except that Clark admits the jurisdiction of the Commission over him and over the subject matter of these proceedings, and admits the Commission's finding that a Final Judgment of Permanent Injunction ("Final Judgment") has been entered against him as set forth in Section III.C., Clark consents to the entry of this Order Instituting Public Administrative Proceedings Pursuant to Rule 102(e) of the Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions ("Order").

Accordingly, IT IS ORDERED that proceedings pursuant to Rule 102(e) of the Commission's Rules of Practice be, and hereby are, instituted.

III.

On the basis of this Order and the Respondent's Offer, the Commission makes the following findings:

A. Craig R. Clark, age 51, was at all relevant times a certified public accountant licensed in the States of California and Texas. During 1996, Clark served as the CFO of Unison HealthCare Corporation ("Unison"), as well as a board member. He resigned from his positions at the board's request in March 1997.

B. Unison, a Delaware corporation with principal executive offices in Scottsdale, Arizona, owned and operated more than 50 health care facilities during 1996. Unison's stock was, at all relevant times, registered with the Commission pursuant to Section 12(g) of the Securities Exchange Act of 1934 ("Exchange Act") and Unison was required to file periodic reports with the Commission pursuant to Section 13(a) of the Exchange Act. During the relevant period, Unison's common stock was listed for trading on the NASDAQ National Market System. Unison filed for bankruptcy reorganization in May 1998, and subsequently changed its name to Raintree HealthCare Corporation.

C. On September 27, 1999, the Commission filed a complaint in the United States District Court for the District of Arizona against Clark, Securities and Exchange Commission v. Jerry M. Walker and Craig R. Clark, Civ. 99-1737-PHX-ROS ("SEC v. Walker"). On March 16, 2001, Clark consented to the entry of the Final Judgment against him in SEC v. Walker, without admitting or denying the allegations of the Complaint, except subject matter jurisdiction, which Clark admitted. On April 11, 2001, the United States District Court for the District of Arizona entered a Final Judgment of Permanent Injunction which: (1) permanently enjoined Clark from violating Sections 10(b) and 13(b)(5) of the Exchange Act and Rules 10b-5 and 13b2-1 thereunder, and aiding and abetting violations of Section 13(a) of the Exchange Act and Rule 13a-13 thereunder; and (2) ordered Clark to pay a civil penalty of $15,000.

D. The Commission's Complaint alleged that Clark and other officers of Unison made unsupported adjustments in financial accounting records that materially inflated Unison's net income figure that was included in Unison's financial statements for the quarter ended September 30, 1996.

The Complaint alleged that Clark, the CEO, and the controller created unsupported journal entries that, among other things, materially increased Medicare receivables and materially decreased expenses for the third quarter of 1996. The Complaint alleged that the adjustments to Unison's third quarter financial statements artificially inflated net income by material amounts. The Complaint alleged that adjustments of $3.391 million to revenues and $1.7 million to expenses were material because they enabled Unison to report positive net income of $1.2 million, or $.30 per share, rather than a loss of almost $4 million.

The Complaint alleged that the adjustments of $3.391 million and $1.7 million, respectively, lacked support in the company's records and that the unsupported adjustments to net income enabled Unison to publicly report positive earnings in line with its previously announced estimates for the third quarter of 1996. As a result, Unison's Form 10-Q for the third quarter of 1996, which was filed with the Commission, was materially false and misleading. Unison later restated its results of operations, which included the third quarter of 1996, to report a pretax loss of nearly $15 million for the nine-month period ended September 30, 1996. Finally, the Complaint alleged that Clark knew or was reckless in not knowing that Unison's Form 10-Q filed for the third quarter of 1996 contained materially false and misleading information because Unison's financial statements included unsupported accounts receivable, revenues, and expenses.

The Complaint alleged that, as a result of the foregoing conduct, Unison failed to make and keep books, records and accounts that accurately and fairly reflected their transactions and dispositions of assets, and Unison failed to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that transactions were recorded as necessary to permit preparation of financial statements in conformity with GAAP or other criteria applicable to such statements

IV.

In view of the foregoing, the Commission deems it appropriate to accept the Offer of Settlement submitted by Clark; and

ACCORDINGLY IT IS HEREBY ORDERED, effective immediately, that:

A. Clark be, and hereby is, denied the privilege of appearing or practicing before the Commission as an accountant;

B. After three (3) years from the date of the Order, Clark may request that the Commission consider his reinstatement by submitting an application (attention: Office of Chief Accountant) to resume appearing or practicing before the Commission as:

1. a preparer or reviewer, or a person responsible for the preparation or review, of any public company's financial statements that are filed with the Commission. Such an application must satisfy the Commission that Clark's work in his practice before the Commission will be reviewed either by the independent audit committee of the public company for which he works or in some other acceptable manner as long as he practices before the Commission in this capacity; and/or

2. an independent accountant. Such an application must satisfy the Commission that: (a) Clark, or any firm with which he is or becomes associated is a member of the SEC Practice Section of the American Institute of Certified Public Accountants Division for CPA Firms ("SEC Practice Section"); (b) Clark, or the firm, has received an unqualified report relating to his, or the firm's, most recent peer review conducted in accordance with the guidelines adopted by the SEC Practice Section; and (c) as long as Clark appears or practices before the Commission as an independent accountant, he will remain either a member of the SEC Practice Section or associated with a member firm of the SEC Practice Section, and will comply with all applicable SEC Practice Section requirements, including all requirements for periodic peer reviews, concurring partner reviews, and continuing professional education.

C. The Commission's review of any request or application by Clark to resume appearing or practicing before the Commission may include consideration of, in addition to the matter referred to above, any other matters relating to Clark's character, integrity, professional conduct, or qualifications to appear or practice before the Commission.

By the Commission.

_______________________
Jonathan G. Katz
Secretary

Footnotes

¹ Rule 102(e)(3)(i), provides in relevant part:

The Commission, with due regard to the public interest and without preliminary hearing, may, by order, temporarily suspend from appearing or practicing before it any ... accountant ... who has been by name ... permanently enjoined, by any court of competent jurisdiction, by reason of his or her misconduct in an action brought by the Commission, from violating or aiding and abetting the violation of any provision of the federal securities laws or of the rules and regulations thereunder.