Subject: SEC Review of Rule 12b-1

July 20, 2007

Nancy Morris:

I am a Financial Advisor. I hold all licenses necessary to conduct either fee or commision based relationships with my clients.

I have been advising clients for over 20 years. I meet with all my clients at least annually. Many of my clients have paid me an innitial commission to purchase their investments. I consider the ongoing compensation I receive under rule 12b-1 to be reasonable compensation for my ongoing service that includes reviewing the continued suitability of our investment plan. If I did not receive this compensation, I would have to charge a fee that now places our relationship under a defferent set of rules with different disclosure and more paperwork that could confuse any client. I feel disclosure is crititcal in our relationship, but differentiating our relationship as a Registered Investment Advisory agent or a commissioned based sales person after the first year shouldn't be necessary.

My clients expect me to be compensated for helping them achieve their long-term financial goals. I believe the real issue is with the mutual fund companies that do not have a sales force to work with clients and are using the fees for advertising. I know the 12b-1 fees are usually described as distribution expenses. Perhaps the solution is better language in mutual fund prospectuses identifying what the expense pays for.

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.

Thank you for your consideration of my views on this subject. I would be pleased to speak with you or your staff on this subject.

Sincerely,

Todd D. Shepard, CFP