Apr. 01, 2023
Dear SEC, I am writing to express my support for the proposed rule change to Regulation Best Execution, as outlined in File No. S7-32-22 and Release No. 34-96496. The proposed changes seek to reduce conflicts of interest by increasing transparency in the routing of orders by brokers and wholesalers, with investors having access to the best priced quotations available in the National Market System (NMS). I believe that the proposed changes to Alternative Trading Systems (ATS) rules promote better alignment with regulatory frameworks for exchanges, which would be beneficial for individual household investors. In particular, I support the requirement for ATS to submit detailed disclosures about their operations, including how they manage conflicts of interest, how they operate their order routing practices, and how they handle customer orders. This would make it easier for investors to understand how ATS operate and how their orders are executed. Additionally, I support the proposal for ATS to establish and enforce written policies and procedures to prevent fraudulent and manipulative practices. This would help to protect individual investors from abusive practices in the ATS market. I also believe that ATS should provide detailed information about the operation of their systems to the SEC, including data on the execution of orders, order routing practices, and information about the use of dark pools. This would improve the SEC's ability to oversee ATS and ensure compliance with regulatory requirements. Moreover, I endorse the idea that ATS should operate in a manner that is consistent with the broader regulatory structure of the securities markets, which would benefit individual investors by promoting fair and transparent trading practices. The proposal to implement a variable minimum pricing increment model for both quoting and trading of NMS stocks would further promote fair pricing across trading venues, which is essential for ensuring a level playing field for all investors. I understand that estimated savings for retail investors range from $1.12 billion to $2.35 billion, primarily through increased competition to supply liquidity to marketable orders. Competition in the marketplace is necessary to regulate markets better, and barriers to competition, such as the conflicted nature of Payment for Order Flow (PFOF), should be removed. Brokers may charge high commissions or fees in lieu of PFOF, so a cap should be implemented. Finally, I believe that household investors support any initiatives aimed at identifying and preventing fraudulent practices that undermine the credibility, integrity, and functionality of American markets. I urge the SEC to prioritize creating a competitive market structure that benefits investors and encourages transparency. Thank you for considering my views on this important matter. Sincerely, Luis J. Gomez