July 19, 2007

I am a licensed insurance professional and registered representative who believes that the majority of investors are better suited for mutual funds than for the increased risk and expense that individual stock purchases entail. I have been in this business for over 33 years, and have developed relationships with my clients that have, in many cases, lasted almost that long.

In return for providing ongoing service and continuing advice to my clients regarding their investments, I receive trailing compensation paid under a written plan adopted pursuant to SEC Rule 12b-1.

The amount of this compensation is relatively modest; for a small annual payment the investors have access to their financial services expert to answer their questions and address their concerns, rather than having nowhere to turn to (except for perhaps a stranger at the end of a 1-800 phone number). When they need some reassurance in a shaky market or assistance in rebalancing their portfolios or a review of their investments relative to their own situation and personal goals, their financial advisor is available.

A significant majority of my clients expect our office to be available and to respond quickly to a variety of questions regarding their investments. I have never received complaints from my clients about these fees, because they receive ongoing services which help them achieve their long-term financial goals.

Therefore, I believe that: (1) If 12b-1 fees were eliminated, while the client might save a small amount in 12b-1 fees, there is a high likelihood that he or she would end up paying a much larger amount in some other way in order to receive the same service.

(2) I also believe that, on the one hand, while the SEC is stressing the "breakpoints" issue and encouraging the use of "one family" of mutual funds if possible, the other hand is considering the elimination of the 12b-1 fee which would be a contradiction to the foregoing concept, and would remove an incentive for the longterm holdings within one mutual fund family.

For these reasons, I urge the SEC to reject any proposal to eliminate or restrict the payment of 12b-1 fees to registered representatives for providing continued service to their clients.