MessageFrom: Mark Royal [mcroyal@royalplanners.com] Sent: Wednesday, May 05, 2004 4:46 PM To: rule-comments@sec.gov Subject: (S7-09-04) May 5, 2004 Jonathan G. Katz, Secretary U.S. Securities & Exchange Commission 450 Fifth Street, NW Washington, DC 20549-0609 Dear Secretary Katz, The mutual fund industry has encouraged hundreds of thousands of individuals and firms to save for retirement and future investment. The industry has provided a valuable tool to encourage savings that help drive our economy. The mutual fund industry has not had to be bailed out like the Savings & Loan industry. It has not embezzled life savings from investors like rogue securities agents. The mutual fund industry has had a VERY POSITIVE effect on society overall. I would encourage you to NOT implement the Proposed Rule "Use of Brokerage Commissions to Finance Distribution." This would hamper the mutual fund industry's ability to finance methods of bringing investors to their funds and KEEPING them in their funds. 12b-1 fees give a broker a small financial incentive to service a client and monitor their investments. Financial advisers help investors stay the course with their investments. People with advisers are more likely to stay invested over the long term. People with advisers are more likely to be diversified. This leads towards MARKET STABILITY. The more investors re-act to the daily news without advice and run in and out the market, the more UNSTABLE our economy. We live in the United States of America where capitalism is praised. The mutual fund industry has a right to make a profit and individual advisers have the right to make a profit as long as the investor is treated fairly and that profit is reasonable. I encourage you not to throw out a well established rule that allows the industry to pay the people who "work" for investors. Mark C. Royal, CLU, CFP® Securities offered through Mutual Services Corporation, Member NASD/SIPC 20101 SW Birch Street, Suite 220, Newport Beach, CA 92660 Office: 949-660-8869, Cell: 949-632-4909, Fax: 949-203-6439