TCR_Public/960602.MBX BANKRUPTCY CREDITORS' SERVICE, INC.


Bankruptcy News For -June 2, 1996



  1. Clarification of items announced by Comparator Systems Corp.





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Clarification of certain items announced by Comparator
Systems Corp.


        
            NEWPORT BEACH, Calif. --May 10, 1996 -- In
        response to questions raised by the NASD, Comparator Systems Corp.
        (NASDAQ:IDID) wishes to clarify certain information.
        


            In a news release dated May 9, 1995 Comparator indicated that a
        cash infusion from a foreign investor was imminent.  Subsequent to
        that release, the British financier failed to perform against the
        signed contract, and that funding did not take place.  The company
        did not then announce that the funding was not, after all, imminent.
        


            The company did not take legal action against the investor due
        to the high cost of litigating a case in a foreign country.
        Although the company is presently in negotiation with a number of
        funding sources, the $2.5 million which it now seeks to initiate
        full-scale manufacturing and marketing has not yet been obtained.
        


            Comparator wishes to clarify that while the company has
        announced two joint marketing agreements during recent weeks, there
        have not yet been any units of its Series 5000 products sold.  This
        new product line will be introduced to the market at the
        CardTech/SecurTech Exhibition in Atlanta, Ga. on May 14-16, 1996.
        The company confirms, however, that sales of its Credit Union and
        Banking software products have occurred in Central America and in
        the United States.  Total sales of financial institution operating
        systems and accounting systems for the six months ending March 31,
        1996 were $366,456.96.
        


            The company is clarifying certain points with respect to its 10-
        K Report for the fiscal year ending June 30, 1995:
        


           The patents listed on the balance sheet in the company's 10-K
           report for the fiscal year ending June 30, 1995 are for
           Comparator's Model ID-1 and Model ID-2 fingerprint comparison
           systems.  The patents on the Model ID-1 have expired but the
           company nevertheless feels that its proprietary knowhow
           provides sufficient protection, and that the ID-1 and/or its
           upgrades is marketable in developing countries.  At the time
           of the 1995 report, the company had not yet filed any new
           patent applications.  The Model ID-1 was carried in 1995 at
           an amortized value of $18,319.50, which represented 0.32% of
           the company's total assets at that time.  The balance of the
           patent value shown in the balance sheet of the company's 1995  
           10-K Report, carried at actual cost less amortization, was
           $2,415,209.60.  This amortized value is attributable to the
           Model ID-2 Comparator, a transitionary product between the
           Model ID-1 and the new 5000 Series.  The ID-2 has been
           produced in engineering prototype but is not in production.   
           The company has done sufficient market research in developing
           countries and it is the company's belief that there is a
           significant third-world market for the ID-2.  The
           whole-finger optical approach employed in the ID-2 is one of
           the technological foundations for optical methodology
           employed in the new software-based 5000 Series.  The company  
           is reviewing the valuation of these earlier patents.  Two new
           patent applications have now been filed but their value has
           not yet been reflected in the company's financial statements.

        
           Comparator is carrying a $744,978.97 account receivable as
           the result of a 1993 embezzlement by the company's Corporate
           Secretary (subsequently terminated), consisting of $81,613.21
           in cash, and the balance in common stock of the company.  
           This was reflected in the company's 8-K Report dated March
           15, 1994 and also described in its previous 10-K reports.  On
           Oct. 27, 1995 the company filed a civil suit, which it is
           pursuing, against 34 individuals involved, and has to date
           recovered 2,725,000 shares of stock, representing 10.97% of
           the total account receivable.  The company will review the
           valuation of this account receivable in light of the ongoing
           litigation and the ongoing recovery of funds.  It appears
           that substantial recovery may be unlikely.  This account
           receivable represents 13.1% of total assets.
       


           Comparator is reviewing the current valuation of certain
           investments carried on the balance sheet in the company's 10-K
           Report for the fiscal year ending June 30, 1995.  These items are
           under review with the company's auditor's to determine whether
           any decreases in valuation are appropriate.  The cumulative value
           of these investments represents 21.4% of the company's total
           assets as reflected in the 1995 balance sheet, and before
           recognition of the value of the new patent applications.  

        
           The total of the account receivable, patents and investments
           noted above is $4,395,133.64, representing 77.4% of the
           company's total assets at the time of the June 1995 report.  
        


            The company is addressing these issues, while completing
        preparations for the introduction of Comparator's Series 5000
        fingerprint comparison systems at the CardTech/SecurTech Exhibition
        in Atlanta.
        


        CONTACT:  Comparator Systems Corp., Newport Beach, Calif.
                  Robert Reed Rogers/Richard E. Floegel, 714/851-4300