The following comment on Letter Type E,
Letter Type E:
Dear Exchange Commission:
I understand that the Securities and Exchange Commission has proposed rules to reform market abuses that arise from the practice known as late trading. While the SEC should be commended for its action, I believe the rule, as currently proposed, will put many consumers at a distinct disadvantage.
The SEC proposal would impose a hard, no-exceptions, 4 P.M. deadline for placing orders. However, millions of participants in 401(k) or similar plans, as well as plans funded through a group variable annuity, transmit their orders through an insurer or pension plan administrator-an intermediary.
Because of this necessary step, the order takes time to process. As a result, consumers like me would miss out on any important market news or developments that occur up to the 4 P.M. deadline.
The SEC's proposed rule attempts to bring fairness and equality to the marketplace. However, the current proposal could unfairly treat millions of consumers like me who work with intermediaries-a consequence the SEC did not intend.
Please consider revising your rules to allow consumers like me who work through intermediaries to transmit purchase, redemption, or reallocation instructions up to the 4 P.M. deadline. Doing so would ensure that we would have the same opportunities as mutual fund shareholders.