Subject: File #S7-09-09

July 6, 2009

I would like to state my opposition to the proposal to have all discretionary accounts subject to a surprise annual audit. I believe the rationale for this requirement is due to the Bernie Maddoff scandal. While I agree in principle with any regulation which will protect the public from unscrupulous activity, this proposal simply misses the mark. If Mr. Maddoff had been required to use a third party custodian rather than himself acting as custodian, I donít believe this fraud and many others like it could have happened.

Therefore, rather than force advisory firms to spend money on audits that are unnecessary, I encourage regulation requiring the use of third party custody of client funds.

Ron Butt

Ron Butt, CFP
Senior Partner,
Registered Principal, NPC