Subject: File No. S7-14-08
From: Joshua M Holden
Affiliation: Investment Advisor Representative

October 29, 2008

I will first say I don't especially like Equity Indexed Annuities. I haven't sold but a couple, and only ones I felt were the shortest term, and easiest to understand, with the best possible outcome for the client I could find. Right now, when the markets have given back a huge sum of investors capital, the Equity Indexed Annuities have protected the clients from any loss whatsoever. That to me is remarkable.

I think it is best for the state insurance departments to be charged with regulating EIAs. I do not think it should be looked at as a security as it is not one. It is not invested directly in stocks, bonds, etc. They cannot lose money unless someone withdrawals in excess of their available free amount. That is a charge, not a loss due to market performance. CDs have penalties for early withdrawal. They are not securities, and are not regulated as such. Are they next?

I don't like how many of these EIAs are put together, but that is the fault of the insurance industry not policing itself, and the state departments not either having the authority to regulate, or for approving for sale these products in the first place. Give the insurance departments the charge and funds to regulate these, but don't make them a security. Just because the SEC thinks they can do a better job regulating doesn't make it right to list something as a security for that reason.