Brothel Plan Interested SEC, Strong Point Says

Officials of Strong Point Inc. said Wednesday that the company has been contacted by the U.S. Securities and Exchange Commission regarding the proposed purchase of a Nevada brothel.

Strong Point President John Davis and attorney Michael Oswald said they were contacted by the SEC last summer and had been asked for documents relating to its proposed $18-million purchase of the Mustang Ranch, a Reno-area brothel. Oswald said the company had supplied the material and had not heard from the SEC since August.

SEC officials said the commission had been intrigued by the proposed Mustang Ranch deal and had wondered how a small company could raise the necessary money to close the sale.

Strong Point officials said escrow on the deal, which was originally announced to the public in December, 1985, remains open while they search for the necessary financing.