Subject: 15-C-211 Proposed Changes Author: "Paul O'Leary" Date: 4/19/99 1:52 PM April 19, 1999 Sir, I have been managing money professinally in the micro-capitalization area of the stock market for nearly 14 years. On April 21 of last year I wrote the Commission regarding proposed changes to 15-C-211 because I felt so strongly that the unintended effects of the proposal would be harmful to the functioning of the capital markets. I am disappointed to hear that a substantially similar proposal is being considered now. Once again, the aim of cracking down on stock fraud is noble, but requiring market makers to review and verify the accuracy of the financial statements and/or business plans of issuers is not the way to go about it. The regulatory burdens are signficant and the legal liability is unquantifiable. Putting regulatory and legal burdens on market makers, as opposed to the perpretrators of criminal activity, will accelerate their withdrawl from the business, leaving legitimate investors with less liquid and more inefficient markets. Legitimate issuers, also, will see the cost of equity capital rise as investors flee an increasingly illiquid, inefficient sector. Companies in transition and newly formed entities are likely to be "red flagged" and never have a chance to shine. I encourage the Commission to conduct a thorough analysis of the practical effects of the proposal on investors, issuers and capital markets. Further, I would ask the Commission to work more closely with market participants, such as the National Quotation Bureau, that understand and appreciate the "real world" effects of your efforts to reduce fraud. Sincerely, Paul H. O'Leary General Partner Raffles Associates, LP One Penn Plaza, Suite 4720 New York, NY 10119