Date:    12/6/96 2:43 PM

The following comments are in response to notice to members 96-80, proposed 
amendments to SEC rules 17a-3 & 17a-4.
     
On page 662 under the heading "Account Forms", proposed rule 17a-3(a)(16) 
states that in addition to needing a new account form for each customer 
account, this account form should include basic identification and background 
information about a customer, as well as a designation of the customers 
investment objective(s) and a specification of the approximate percentage of 
investment capital that the customer would like to allocate to speculative 
investments.
     
The proposed rule 17a-3(a) also states that it will apply to both new and 
existing customer accounts.
     
The proposed rule includes a one year updating requirement with respect to 
investment objectives designated on each customers account form.
     
The basic problem I have with these changes are based on my firms size. While 
I agree that these are useful changes in customer disclosures, they will put 
an unnecessary burdin on small firms. My firm already has on its new account 
forms an area for investment objections, but if I was to go back to all my 
clients and ask them what percentage they wish to have invested in 
speculative investments it would cause a great deal of work, even with your 
one year time frame. In addition customers usually do not reply to mail, so 
if we ask them to do this by mail most people would ignore this request. 
Would it be enough to prove we sent the information to the client but they 
never responded? I would suggest all new accounts should require this 
information and perhaps all active accounts with a certain amount of account 
activity.
     
Once this information is obtained, it seems again to be an overburden on 
small firms to keep asking for the same information every year. My experience 
has proved that customers get very irritated when asked for the same 
information over and over again. Would it be sufficient to send the customers 
a negative consent letter telling them what they currently show as their 
investment objectives and asking them to send back a reponse only if they 
wish to change the information? This seems like a fair compromise.
     
I have been in operations for over 17 years and have worked in both big and 
small brokereage firms, in both the front and the back office. I am a 
proponent of any changes which are made to prevent customer fraud and 
mishandling of investments, but please try to keep the small firms in mind 
when asking for material changes in how we keep our books and records.
     
Under "Complaints" proposed rule 17a-3(a)(18) would require records of all 
commissions, overrides and other compensation identified by each transaction. 
As the FINOP of my firm I keep all the records of commisions on a daily 
electronic blotter. These records are based on information from individual 
order tickets but are tallied as a summary. The information can be traced back 
to all the individual trades but I do not post the trades for production 
purposes individually. A summary of different catagories is kept by broker. If 
I need to keep individual records by broker on a daily basis it would increase 
my workload 300%. Again I am a small firm and have no help. I do keep a daily 
trade run which specifies all the trades by account, broker, commission etc, 
but this run does not specify time of execution. That information is on my 
trade tickets. Is this enough of a trail or is the purpose of this change to 
make brokers account for all trade information in one place?
     
I hope these comments are helpful
     
Sincerely;
     
Douglas Colombo
PMK Securites & Research, Inc.