Subject: File No. S7-09-04
From: Robert W Haugan, Esquire

March 31, 2004

While I understand the current concern over excessive or hidden fees, I believe that the elimination of 12b-1 fees will not address either of those concerns. Advisors who are denied 12b-1 fees will simply find another way to charge their clients, and if they dont then clients who legitimately need service will be denied advice. Additionally, since many wrap accounts add extra fees in the end investors will pay more if 12b-1 fees are eliminated.

I believe rather than eliminate the fees entirely that better disclosure would alleviate many of the concerns relating to 12b-1 fees. Investors would be able to decide for themselves how to compensate an advisor for their advice, or to decide for themselves if an advisor is overpaid. For those investors who are comfortable with the existing system, they would be allowed to continue with their current relationships instead of the SEC mandating that, despite the investors wishes, that they could not.

I also believe that completely eliminating 12b-1 fees could have unintended or unexpected results in the advisor marketplace.

In closing, it would be better to stay with the current system while requiring additional disclosure.