Subject: File No. S7-14-08
From: Mikelan Coleman
Affiliation: Concerned Citizen

July 18, 2008

File No. S7-14-08 proposes amending the substance of the Securities Act of 1933. In particular, the SEC wants to amend section 3a8 of that act which reads as follows:

"SEC regulation shall not apply to ... any insurance or endowment policy or annuity contract or optional annuity contract, issued by a corporation subject to the supervision of the insurance commissioner, bank commissioner, or any agency or officer performing like functions, of any State or Territory of the United States or the District of Columbia"

The belief that indexed annuities are insurance products within the clear intent of this article is held by many knowledgeable people including insurance company professionals of many disciplines, the American Academy of Actuaries, the NAIC corporately as well as individual insurance commissioners from every state. Because the act is so clear on this point, the SEC has rightly understood that it cannot simply interpret the act as it was written. To exclude indexed annuities from the regulatory protections of the act requires new information not already contained within its clear intent.

The Securities Act of 1933 is a foundational act upon which industries, regulatory schemes, business investment and careers depend. The provisions of this act are woven deeply into the fabric of many lives, including my own.

Although I did not fully understand until now, my familys livelihood and that of many thousands of others depend on the historic scheme of regulation whereby indexed annuities and other insurance products are regulated by the state insurance departments and they are not subject to federal, SEC oversight. This line of regulatory demarcation, established over 70 years ago by the act mentioned above, should be handled in accordance with its long tradition and in light of the thousands of lives now depending on its stability.

Because this act of congress is so old and so foundational, any change to the act must be demanded by a force sufficient to merit the upheaval such a move would create.

As can be seen in this forum, the various points in this case about sales practices, commissions, disclosure, risk transfer, etc. are debatable. People on both sides of this case can make reasonable arguments for their positions. In my opinion, these arguments whether well-intentioned or purely self-interested are insufficient to move so foundational a rule. It is the stability of our laws that encourage investment at every level and make our economy prosperous.

Please reconsider the importance of the historic rule of law and the lives that depend upon it. For these reasons, I appeal to you to rescind proposed rule 151A.