Date:    12/22/1999  1:13 AM

Subject: S7-31-99 Fair Disclosure
 
December 22, 1999
     
Dear Sir:
     
    I applaud the proposed issuance of rule S7-31-99 requiring fair 
disclosure of all material information to the public, simultaneously or 
immediately after unintentional selective disclosure.
     
    I would like to recommend one modification to the rule.  When the 
information has been unintentionally disclosed selectively, the burden of 
corrective action is on the issuer to make public the information previously 
disclosed.  In the interim, the receivers of the information, security 
analysts and institutional investors, are free to act upon the information 
through security trades, and are free to further disseminate the information 
to other institutional investors. Given the speed of information exchange and 
trade execution in the security markets today, an unintentional disclosure 
can have the same effect as a selective disclosure.  The SEC should modify 
the rule to require that a receiver of information, particularly one that is 
in regular contact with the issuer such as a security analyst or 
institutional investor, be required to determine from the issuer whether the 
information provided has been or is in the process of being publicly 
disclosed before the receiver can act upon the information.  The change, if 
doable, will remove incentives to "accidentally" unintentionally disclose 
information to analysts and institutional investors.  It seems that it would 
be extremely difficult for the SEC to show that the disclosure was not 
unintentional, particularly if immediately thereafter corrective action is 
taken to make the information public.  It is also unclear how an issuer would 
determine if they made an unintentional disclosure since there may be 
instances where the issuer is unaware of the material disclosure they have 
made. Therefore, it would seem that the burden to insure public disclosure 
has to fall on both the issuer and receiver of the information for the rule 
to have any meaningful effect and to be enforceable.
     
Thank you,
Milton Recht
Recht & Company
25 Dogwood Rd.
Mount Kisco, NY 10549