Subject: File No. S7-12-06
From: Robert M Nuckols
Affiliation: Retired small business owner

August 7, 2006

In your description of what the SEC does, you state:

"The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.

As more and more first-time investors turn to the markets to help secure their futures, pay for homes, and send children to college, our investor protection mission is more compelling than ever.

As our nation's securities exchanges mature into global for-profit competitors, there is even greater need for sound market regulation."

It is about time that your start reading this statement and remembering that your job is to protect the small investor from Wall Street, not assist Wall Street in fleecing the small investor.

Your Regulation SHO is a joke, You grandfathered in all the previous illegal short sales made by Wall Street and then created exceptions so that Wall Street could resumed their job of fleecing the small investor.

To get back on track and give the small investor a chance, you have got to eliminate all the exceptions and grandfather clauses that were put in Regulation SHO for the benefit of Wall Street. They sure were not granted for the benefit of the small investor.

I understand how shares can be loaned out so that they may be sold short by an investor who believes the stock will go down, but you must install safeguards so that Wall Street cannot loan these same shares out multiple times thereby counterfeiting shares to the detriment of the small investor.

Lets clean this mess up. You must require that shares be borrowed first before they are sold short, and that once these shares are sold short, they cannot be used to support another short sale. You must also require that any Fail To Delivers be bought in to eliminate any further
price manipulations by Wall Street.

Rmember your mission statement is to protect the individual investor, not Wall street.