Subject: File No. S7-18-09
From: Jim Glantz, PsyD

September 24, 2009

To whom it concerns:
i believe your new SEC regulation includes sweeping measures that lead to vast injustices, imposed a huge burden on the private placement industry through the Securities and Exchange Commission (SEC). In effect, the SEC regulations will, if enacted, virtually put certain company out of business as well as thousands of other investment bankers/placement agents. The reason behind the SECs proposed regulations is a recent pay-to-play scandal orchestrated by the former Chief Investment Officer for the New York Common Pension Fund who recruited a solicitor to help extract illegal kick-backs from complicit money managers in return for investment commitments from the pension fund. These actions are unquestionable illegal and these individuals should be and will be prosecuted to the fullest extent of the law. However, the SEC should not go overboard and take extreme actions to curtail a specific 'pay-to-play abuse. For the most part, I support the SEC regulations however, in the SEC's rush, they are proposing one specific regulation that I dramatically oppose. This provision proposes to ban the use of any investment bankers/placement agents from doing any business with any public pension plans. This regulation is both dysfunctional (it damages the very constituents, pension plan employees, it is trying to protect) and unjust (it destroys an entire well-regarded industry of hard working professionals based on the actions of a few corrupt individuals). I vehemently contest this provision, ask the SEC to eliminate this provision for the following reasons:

Public pension funds represent a majority of all the capital invested in the private equity industry and eliminating access to this magnitude of capital will devastate the placement agent business
The vast majority of emerging, small and middle-market investment managers rely extensively on investment banker/placement agents, to gain access to pension fund capital. Without these services, many of these companies will simply not survive or be forced to operate at a untenable disadvantage
Pension funds will be harmed because without placement agents, there will be a dramatic reduction in their access to potential investment opportunities from emerging, small and middle-market investment managers
Pension funds will no longer be able to use placement agents to help them identify, pre-screen and evaluate potential investment manager candidates
The placement agent and investment management industry will incur dramatic job losses

As opposed to an outright ban of placement agents, I propose a much more equitable and effective solution, and that involves the SEC implement more stringent licensing, oversight and disclosure regulations equally on all participants in the investment process.
Thank you,
Jim Glantz