May 2, 1994

As Government investigators and lawyers continue to unravel the fraud scandal at Prudential Securities, a question keeps arising: Did senior executives ignore warnings 14 years ago about potential high-level corruption in the firm's partnership division, which is now at the heart of the biggest retail brokerage scandal in history? The warnings came from a small group of midlevel executives at the firm, then known as Bache & Company, who passed along information indicating that the head of their division, James J. Darr, may have accepted improper payments from clients while working for another firm. An internal investigation at Bache cleared Mr. Darr of wrongdoing, and the careers of several of his accusers quickly collapsed.

The reported instances of child abuse and neglect in the region increased last year, after having declined since the start of the decade. State officials and child welfare advocates cannot say exactly why, but they cite several factors: the continuing problem of substance abuse, stricter reporting, and increased attention in the past year to violence and its effects on young people. Child welfare agencies say they are trying to become less reactive and offer more support services for at-risk families before trouble sets in. The Federal budget for fiscal 1994, ending Sept. 30, allocates $60 million to the states for Family Preservation and Support, the first installment of a five-year, $5 billion initiative.

The nation's foundations are discovering prosperity has its perils. As a group, their financial health has never been better. Their ranks keep growing: 35,765 foundations in 1993, with 11,000 of them created since 1980. A bullish stock market raised their combined assets to an all-time high of $177 billion last year.

The African National Congress estimated from early returns Sunday night that it had won a solid victory in the election for South Africa's first post-apartheid Parliament, but conceded that it would not win the lopsided majority that would give Nelson Mandela a free hand in writing a new constitution. The broadest smile, in fact, belonged to President F. W. de Klerk, whose National Party appeared to have crowded aside all other opposition parties and picked up a fraction of the black vote to secure its future as the second party in a two-party system.

NEW YORK CITY TOUGHENING RULES FOR GRADUATING Starting this fall, every New York City high school student will be required to take advanced science and mathematics courses to graduate, while less challenging classes in those subjects will be eliminated, Chancellor Ramon C. Cortines announced. Educators said the change might be the most ambitious upgrading of academic standards ever undertaken by a major school system. The initiative will affect more than 250,000 students, said Askia Davis, senior assistant to the Chancellor. A1.