From: Anonymous
Sent: Tuesday, August 15, 2006 3:53 PM
To: Rule-Comments
Subject: SR-NASD-2004-183

I have been a licensed insurance professional and registered representative selling variable products for 18 years. I am writing to you concerning the suitability standard and principal review requirements pertaining to the sale of variable annuities contained in NASD proposed Rule 2821. I am aware that even though the latest NASD proposal includes several amendments made to earlier versions of the proposal, the proposed rule's requirements are redundant, unnecessary, will provide no meaningful additional protection to consumers and will adversely impact my business. I urge the SEC to disapprove the proposal.

I truly believe people who engage in misleading sales practices should be aggressively prosecuted and subject to appropriate sanctions. However, the NASD has failed to adequately justify the need for the proposed rule.

To the contrary, the available data does not support the NASD's claims that the level of sales problems in the variable annuity marketplace calls for the adoption of the proposed rule. Unsuitable variable annuity sales made up less than .50 percent of the NASD's disciplinary actions over the last five years. Complaints about mutual funds and individual securities far outnumber those concerning variable annuities.

The majority of the comments received by the NASD and SEC regarding the proposal are in opposition to the new rule. The NASD has not adequately responded to the concerns raised by the vast majority of commentators.

The proposed Rule 2821 duplicates current supervision and suitability requirements that are already in place. NASD rules (including Rule 2310) already contain suitability requirements that apply to ALL sales of securities, including variable annuities. If regulators really want to protect consumers, then appropriate enforcement of the existing suitability rule is the answer. Not more rules, regulations and duplicate supervision!!

I believe that the requirement for review by a principal found in the proposed rule deviates in several significant ways from the general supervision requirements found in Rule 3010. This requirement appears to present a bias against these products, and will lead to constant second guessing of my advice and recommendations. My principal has much less first had information available to them than was available to me. I am responsible for enough data collecting, paperwork and reporting without another level of documentation and oversight.

The NASD proposal is a solution in search of a problem that could ultimately harm consumers by making these products less available to people who benefit from them. For these reasons, I urge the SEC to disapprove NASD proposed Rule 2821. Thank you for your consideration of my views on this matter.