Subject: File No. S7-14-08
From: Randy S Koontz
Affiliation: Financial Advisor

July 10, 2008

Index annuities should absolutely, unequivocally be regulated as securities. They invest in equity indexes and should have been treated no differently from Variable annuities. I have approximately 20 years of experience in the brokerage business and during that time I have dealt with and continue to deal with large numbers of seniors. I have seen countless misleading and fraudulent investment schemes and sales pitches and without a doubt I see more misrepresentation and lack of disclosure in the sale of index annuities than in any other financial product in recent years. I continually have clients who have been to a seminar, or other presentation who bring me the material, which never discloses the 15 - 22 year surrender penalties, nor the outrageous commissions being paid to the insurance agents touting them. We have a rep in our area who lost her securities license and received a multi year ban from the industry and a huge fine who simply started selling index annuities. The Arkansas insurance department is not equipped to regulate, or deal with index annuities. Please treat index annuities for what they are, and regulate them like you regulate mutual funds and variable annuities. The reputable index annuity representative will not be affected and has nothing to fear.

Randy Koontz