Date:    09/18/2000  11:06 AM

Subject: Subject:  File No. S7-24-99

 I wish to have my comments regarding the short sale of OTC stocks submitted
into the record for consideration.  Regarding the following Question #35, 
please consider extending the short sale regulation to cover OTCBB stocks and 
regarding Question #36, I feel the current NASD short sale rule would be an 
applicable model for this purpose.  
     
Thank You,
Mary J. Meister
     
     
     
17 CFR PART 240
Release No. 34-42037; File No. S7-24-99 
RIN 3235-AH84
G. Extending the Short Sale Rule to Non-Exchange Listed Securities
Current short sale regulations cover securities that are either listed on an 
exchange or traded in the Nasdaq NMS. As a result, they cover securities 
that are generally characterized by high trading liquidity. In addition, 
these markets have a relatively high degree of transparency.
Securities traded in the OTC markets (e.g., Nasdaq Small Cap, the NASD's 
OTCBB, the Pink Sheets) are not subject to short sale restrictions. The 
staff frequently receives complaints alleging short sale abuses involving 
securities in the OTC markets. As a corollary to other concepts presented in 
this release, we seek comment on regulating short sales in this market 
sector. We recognize that Section 10(a) does not grant specific authority to 
the Commission to regulate short sales of securities not listed on a 
national exchange. Thus, regulations that extend short sale regulation to 
new market sectors would have to be adopted under other available statutory 
authority.
Q35.    Should we consider extending short sale regulation to cover 
non-exchange listed securities? 
Q36.    If so, how should the new regulation restrict short sales? Does the 
current NASD short sale rule provide an applicable model for this purpose?