From: Arnold Ward [awardnetmail@netscape.net]
Sent: Wednesday, March 10, 2004 7:12 PM
To: rule-comments@sec.gov
Subject: File No. S7-11-04 mandatory mutual fund redemption fees

The rule should permit, as the current laws allow, a mutual fund to charge a
redemption fee but not mandate such a fee for all funds.  Mandating redemption
fees constitutes government mandated expense to the investor to protect the
mutual fund.  We do not need the government protecting the mutual fund from
the investor.    Mutual funds are free to charge redemption fees and many funds
currently do, even some held by financial intermediaries and even low cost or
no cost mutual funds and especially even small mutual funds.  The free market
can decide better whether redemption fees should be charged and the government
should stay out of this arena.  The idea that there is “competitive pressure
 not to charge redemption fees and therefore the government must step in to
make a uniform enforcement fee is Big Brother at its worst.  What else in the
trading world is Big Brother going to protect the investor or mutual fund from?
 Abrupt changes in share value from changes in stock value caused by excessive
selling?  The stock market, by its nature, is fluidic and comprised of continually
changing prices. An investor who changes their mind and wants out should not
be precluded or hindered by government-forced penalty fees as this proposed
body of regulations suggests.  Let the mutual fund decide individually, based
on its own specific costs, whether or not a redemption fee or penalty is 
necessary, and if so at what percent or amount.   Doing what this body of 
regulations suggests mandates more paperwork and bureaucracy for mutual funds 
which already are amass in such bookkeeping requirements, the cost for which will 
be directly born by the mutual fund investors as a group.

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