From: David E. Ross [david@rossde.com]
Sent: Thursday, March 04, 2004 4:15 PM
To: rule-comments@sec.gov
Subject: S7-11-04:
Comments:
1. Yes, the fee should be mandatory, universal, and uniform.
2. The exceptions should NOT include unanticipated financial
emergency. This is too hard to verify and too easy to contrive or
even fake.
3. The exceptions should include any purchases made via automatic
transfers of dividends from other funds from the same fund group. I
own several funds in the Vanguard Group. Dividends on several of
them are automatically transferred to one of them. In this case, I
should not be inhibited from withdrawing the amounts transferred.
4. Vanguard already imposes a similar fee on some of its funds. On
some funds, the fee is applied only on redemptions via phone or
Internet but not via letter sent through postal mail, for more than
two redemptions in 12 months. It should be mandatory that any such
fee (either through proposed rule 22c-2 or on a funds own
initiative) must be applied uniformly without regard for how the
customer initiates the transaction. Vanguard's exemption for
redemptions via letter and postal mail puts customers living on the
Pacific coast at a disadvantage with respect to customers close
enough to Vanguards offices to have next-day delivery of postal
mail. No such exemption should be allowed.
5. The five-day holding period should be market days, not calendar
days.
6. Funds should be required to include the fee when computing sales
loads, commissions, or other charges levied when fund shares are
redeemed. That is, the charges should be based on the lower amount
remaining to be paid the customer, after subtracting the 2% fee.
7. Better clarification is needed to ensure the 2% fee is retained
by the fund for the benefit of the remaining share holders and is
not to be used for the benefit of the fund management.
David E. Ross
Oak Park, CA 91377
David E. Ross
I use Mozilla as my Web browser because I want a browser that
complies with Web standards. See .