Subject: File No. S7-12-06
From: Shane Montgomery

September 29, 2006

Commission Staff,

It is with concern that I write to you regarding this issue. I see a clear and distinct parting of mindset between the investing public and the industry and can only hope that your decisions to be made are in the interests of protecting our markets globally and not simply protecting a business enterprise.

Clearly, members of the Industry want nothing changed in our laws because it is not in their financial best interest. Members and lobbyists alike have all but stated that in each of their prepared comment memo's to the Commission staff. Under the umbrella of liquidity, market members are not to be guaranteed the rights to profit at the expense of the investing public and yet that is specifically what has been requested of you.

Market participants have threatened the SEC through claims of reduced market liquidity if they are not afforded the guarantees they seek. For the SEC to mold their decisions around such threats would be yet another stab at investor confidence and ultimate market growth.

Members must take risks, as each investor has, in their decision making efforts. If members want to hedge a position or take the risk of a naked short in a bona-fide exemption, that decision must come with risk and not guarantees of profit. Our markets globally are presented as fair and to meet those high standards we must have laws in place that apply equally to both members and investors. Members must not be given the inside advantage to profiteering at the expense of others.

Ultimately the natural trading of the underlying security, as registered by the issuer, must be protected above all other trading strategies. That is the only way our markets will grow. If the intrinsic value of the underlying equity is lost in the maze of confusion and fraud, so goes the value of our markets.

Options Markets, derivatives, complex trading strategies of all types are second tier trading strategies that can only be protected after the underlying equity is secured. Business issuers and the majority of the general public trade off the underlying equity and the complex trading strategies developed for the sophisticated investor cannot be used developed in a manner that impairs the underlying foundation of the market - the value of the registered equity.

How far has Wall Street gone to protect their right to riskless investments?

I read the Comment memo by the American Bar Association and laughed.

1. Who funded this comment memo? The ABA never chimed in during the original proposal of SHO and in theory the ABA has nothing to do with the methodologies of how a market operates. Instead of discussing market conditions the ABA memo challenged the rights of the SEC to even consider a rule change. Does the ABA represent a particular interest in such a comment memo? My guess is they were enlisted by Wall Street who has been rumored to have hired some of the top firms in Wall Stret to fight this reform.

2. The ABA cites a lack of empirical data by the SEC to support this change. Has the ABA reviewed most SEC proposals and submitted similar comment memo's on the requested reform? Clearly this proposal has little difference to other proposals submitted for public comment by the SEC regarding data? The answer is no, so why now?

3. The ABA claims that the SEC can not make changes to the laws should they draft new laws that differ from this proposal unless those proposed changes are re-submitted for public comment. Clearly this is a strong arm delay tactic by Wall Street to any reforms. I can support this comment by simply requesting where the ABA uproar was when the SEC initially created the grandfather clause over 2 years ago. That clause was a concept dreamed up after Wall Street lobbyists walked the halls of the SEC and was never presented to the public until new law was drafted and approved. The ABA did not then voice concerns over the process but suddenly do now.

This double standard Wall Street expects from the SEC should be of concern to the Commission. These messages are coming through loud and clear and these are messages of intimidation and threat should the Commission act in a manner not suited to the powerful Institutions of Wall Street.

As an investor I can only ask why Wall Street is so determined to stop any and all reforms regarding the timely settlement of securities. That is where the Commissions focus should be. Failures are a liability and why would Wall Street risk maintaining such liability unless they do not actually perceive it as a liability but a profit center.

With my heart I can only hope the Commission staff chooses the right path before you. Much of middle class America, from the employee of an abused public company to a small investor with a retirement plan that needs protection, depends on the Commission's resolve in addressing this issue.

Thank You