From: Gary Samek
Sent: March 31, 2005
Subject: File No. S7-06-04

Re: SEC Proposal on Point of Sale and Confirmation Disclosures

Dear Mr. Katz:

As a Certified Financial Planner, practitioner, I am concerned about the potential negative impact that the SEC's proposal on point of sale and confirmation disclosures will have on clients and future clients.

I am an INDEPENDENT financial advisor, offering my clients the most appropriate investment vehicles based on an UNBIASED assessment of their needs. The SEC point of sale disclosure system, as proposed, would have the unintended consequence of substantially limiting the broad universe of mutual funds and variable annuities that I am now able to offer my clients. This consequence could affect approximately 250 clients who currently invest in mutual funds.

Cost is only one factor in any investment decision, and I would argue not the most important factor. This proposal misleads investors into believing that the lowest cost product is the most suitable. It does not encourage investors to weigh all factors of suitability.

Case in point. Do you think O.J. Simpson would be free and walking the streets today if he hadn't hired Johnnie Cochrane? I'm sure he could have found many lawyers who cost a lot less! I think everyone would agree that O.J. got his monies worth. What did you charge, when I'm sure, you were in private practice? Were your low fees the overriding reason you felt clients should come to you for legal advice as opposed to the rookie down the street? I didn't think so.

In the end it will be the individual investor who will ultimately pay the added cost of implementing this proposal, either through increased fees or a limitation in the number of products offered. With President Bush telling us there is a social security crisis how many "Joe Lunchbuckets" will hear so much about brokerage fees on the evening news that the already abysmal U.S. savings rate will get even worse because he will throw up his hands in disgust and go out and buy a new truck with that inheritance he just received instead of investing it for his retirement? This "cost is everything" mentality you are helping to create will be your legacy.

Gary Samek, CFP