Benchmark Conditioning Order

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IN RE APPLICATION OF:

BENCHMARK ASSET
MANAGEMENT, LLC
(IA-1013444)

JOHN ANDREW KINNEY
(CRD Number 1918369)

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CONSENT ORDER CONDITIONING
REGISTRATION AS AN
INVESTMENT ADVISER AND AS
AN INVESTMENT ADVISER AGENT

No. CO-01-6321-S

WHEREAS the Banking Commissioner (the "Commissioner") is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the "Act") and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies promulgated under the Act (the "Regulations");

WHEREAS on February 20, 2001, Benchmark Asset Management, LLC (hereinafter, the "Applicant"), a limited liability company located at 2614 Boston Post Road, Carriage House, Suite 3812, Guilford, Connecticut filed with the Commissioner an application for registration as an investment adviser pursuant to Sections 36b-7 and 36b-32 of the Act;

WHEREAS John Andrew Kinney, the sole managing member of the Applicant and holder of a 100% ownership interest, applied for registration as an investment adviser agent of the Applicant under the Act on February 20, 2001;

WHEREAS the Commissioner, through the Securities and Business Investments Division (the "Division") of the Department of Banking has, in conjunction with its review of the Applicant's registration application and Kinney's application for registration as an investment adviser agent, conducted an investigation of the Applicant and of Kinney pursuant to Section 36b-8 of the Act;

WHEREAS as a result of such investigation, the Division has ascertained that on August 22, 2000, a New York Stock Exchange Hearing Panel (Decision No. 00-140) censured John Andrew Kinney; fined him $5,000 and imposed a six week bar from membership, allied membership, approved person status and from employment or association in any capacity with any member or member organization. The NYSE action was based on findings that John Andrew Kinney 1) engaged in conduct inconsistent with just and equitable principles of trade by reallocating executions among customers, so that one customer was benefited by receiving a more favorable execution price than the customer was entitled to, and three customers were disadvantaged by receiving a less favorable execution price than they were entitled to; and 2) caused one or more violations of SEC Rule 17a-3 and Exchange Rule 440 by causing one or more books or records of his member organization employer to be inaccurate. The bar would commence on October 2, 2000;

WHEREAS as a result of such investigation, the Division believes that a basis exists under Section 36b-15(a)(2)(F)(iii) of the Act for restricting or imposing conditions on the securities or investment advisory activities that the Applicant and Kinney may perform in this state based on the sanction imposed upon Kinney by the New York Stock Exchange;

WHEREAS Section 36b-15(a) of the Act provides, in part, that:

The commissioner may by order deny ... any registration or by order restrict or impose conditions on the securities or investment advisory activities that an applicant ... may perform in this state if he finds (1) that the order is in the public interest and (2) that the applicant ... or, in the case of a investment adviser ... any partner, officer, or director, any person occupying a similar status or performing similar functions, or any person directly or indirectly controlling the investment adviser ... (F) is the subject of any of the following sanctions that are currently effective or were imposed within the past five years: (iii) a suspension, expulsion or other sanction issued by a national securities exchange or other self-regulatory organization register[ed] under federal laws administered by the Securities and Exchange Commission ....

WHEREAS the Applicant and Kinney neither admit nor deny that the foregoing would support administrative proceedings under Section 36b-15 of the Act, and agree to the entry of this Consent Order solely for the purpose of obviating the need for formal administrative proceedings on the matters described above;

WHEREAS the Applicant and Kinney voluntarily agree to waive any right to a hearing upon the entry of this Consent Order, and waive the right to seek judicial review or otherwise challenge or contest the validity of this Consent Order;

WHEREAS the Commissioner finds that the entry of this Consent Order is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of this Act;

NOW THEREFORE, THE COMMISSIONER ORDERS AS FOLLOWS:

(1)	For two years, commencing on the date this Consent Order is signed by the Commissioner, the Applicant and Kinney shall refrain from having custody of client funds or securities;
(2)	For two years from the date this Consent Order is signed by the Commissioner, the Applicant and Kinney shall not, absent prior written approval from the Division Director, exercise discretionary trading authority or control over client funds or securities;
(3)	For two years, commencing on the date this Consent Order is executed by the Commissioner, the Applicant and Kinney shall limit their investment advice to securities listed on the New York Stock Exchange, the American Stock Exchange and/or the National Market System of NASDAQ; covered options and warrants relating to any of the foregoing; commercial paper; certificates of deposit; corporate debt securities; municipal securities; securities issued by investment companies subject to regulation under the Investment Company Act of 1940; United States government securities; and insurance products subject to regulation by the Connecticut Insurance Commissioner. Nothing in this paragraph shall preclude the Applicant and Kinney from referring clients to advisers whose activities are not so limited and receiving a referral fee in conjunction therewith provided full written disclosure of the fee arrangement is made to the client;
(4)	For two years, the Applicant and Kinney shall notify the Division Director in writing each calendar quarter of any securities-related complaints, actions or proceedings (including arbitrations and updates thereto) involving the Applicant and/or Kinney, as the case may be, that occur during the quarter, including the disposition thereof. Such report shall be provided no later than ten business days following the close of the quarter. If no complaints, actions, proceedings or updates exist for the quarter, the report shall so indicate. The first report shall be due no later than ten business days following the quarter ending September 30, 2001, and the final report shall be due no later than ten business days following the quarter ending September 30, 2003;
(5)	Entry of this Consent Order by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against the Applicant, Kinney or both based upon a violation of this Consent Order or the basis for its entry if the Commissioner determines that compliance is not being observed with the terms hereof or if any representation made by the Applicant, Kinney or both in connection with their applications for registration is subsequently discovered to be untrue;
(6)	The name of Benchmark Asset Management, LLC be and is hereby entered on the Register of Investment Advisers pursuant to Section 36b-8 of the Act;
(7)	The name of John Andrew Kinney be and is hereby entered on the Register of Investment Adviser Agents pursuant to Section 36b-8 of the Act; and
(8)	This Consent Order shall become final when issued.

            ________/s/_________
            John P. Burke
            Banking Commissioner

So ordered at Hartford, Connecticut
this 25th day of July, 2001.

CONSENT TO ENTRY OF ORDER

I, John Andrew Kinney, being duly sworn, do state, individually and on behalf of Benchmark Asset Management, LLC, that Benchmark Asset Management, LLC and I agree voluntarily and without threat or coercion of any kind to the entry of this Consent Order, voluntarily waiving any right to a hearing on the matters described herein.

      Benchmark Asset Management, LLC

By   _________/s/_________________
      John Andrew Kinney
      Managing Member

    _________/s/_________________
      John Andrew Kinney
      Individually

Subscribed and sworn to before me this
23rd day of July, 2001.

____________/s/__________________________
Notary Public/Commissioner of the Superior Court
My Commission Expires: Dec. 31, 2005

Conditional Registrations

State of Connecticut Department of Banking