Oct. 29, 2023
Dear Sir/Madam - I am writing to express my concerns regarding the proposed rule on "Safeguarding Advisory Client Assets" by the Securities and Exchange Commission (SEC). As a concerned citizen and investor, I feel compelled to offer my input on this matter of utmost importance. The proposed rule seeks to enhance investor protections and address gaps in the custody rule. While these goals are indeed noble and commendable, I believe there are certain areas that require further consideration to ensure the rule's effectiveness and alignment with the principles upon which our great nation was founded. One such area is the cybersecurity requirements for custodians, particularly in relation to digital assets. In this age of ever-advancing technology, the threat of cyber attacks looms large, and it is crucial that we secure the digital infrastructure that houses clients' assets. The proposed rule, unfortunately, falls short in outlining robust cybersecurity protocols for custodians. To truly safeguard client assets, it is imperative that stringent measures are put in place to protect against theft, fraud, and unauthorized access. We must take heed of the wisdom of our founding fathers, who envisioned a nation where the rights and property of individuals are protected at all costs. Additionally, I am concerned about the implications of the proposed rule on individual privacy. In our digital age, personal data has become a valuable asset, and its protection should be of paramount importance. Granting third-party entities access to sensitive financial information and personal details, such as social security numbers, without sufficient safeguards poses significant risks. We must tread carefully and strike a balance between strengthening investor protection and preserving the privacy and personal liberty that our founding fathers so dearly cherished. Moreover, it is essential to thoroughly assess the rule's effectiveness in closing gaps in the custody rule and addressing potential conflicts of interest. While I appreciate the SEC's intent to enhance investor protection, it is crucial to consider alternative solutions and solicit public input to ensure that the rule optimally serves its intended purpose. Our founding fathers believed in the power of thoughtful deliberation and collective wisdom, urging us to question and challenge existing norms to pave the way for a better future. In addition, I would like to highlight the need for comprehensive guidelines and safeguards for investment advisers when handling assets that cannot be maintained with a qualified custodian. The proposed rule acknowledges this issue, but it must provide explicit instructions on diligent recordkeeping, separation of duties, and regular reviews. Such measures will ensure transparency, accountability, and the steadfast protection of client assets. Furthermore, the segregation of client assets from the adviser's assets is commendable, but we must carefully consider exceptions to prevent unintended consequences. Full and transparent disclosure of these exceptions is necessary to retain trust and confidence in the investment industry. Our founding fathers yearned for a nation built on integrity, transparency, and the embracement of truth. Lastly, it is vital to weigh the economic impact and compliance burden that the proposed rule may impose on investment advisers and qualified custodians. While we strive for measures that enhance investor protection, we must also be mindful of the operational feasibility and potential unintended consequences. Rigorous analysis of the economic impact will allow us to strike a balance that fosters growth, innovation, and security. In conclusion, as our nation continues to navigate the complex landscape of financial regulations, it is vital that we integrate the wisdom and principles of our founding fathers. The proposed rule should exemplify the values they held dear - clear and robust protections for individual rights, privacy, and property while promoting transparency, accountability, and economic prosperity. Thank you for considering my concerns regarding the proposed "Safeguarding Advisory Client Assets" rule. I trust that the SEC will heed the call for public input, embracing the values that have guided our nation for centuries. May we forge ahead, united in our pursuit of a financial landscape that upholds the ideals embodied by our founding fathers. Sincerely, Kalyn Beery