From: Veda Cassells-Jones
Sent: July 5, 2007
Subject: File No. 4-538

This letter is to express my thoughts, experience and concerns about the SEC's upcoming review of Rule 12b-1. The focus should be on what is best for the CLIENT.

Clients with small amounts of money to invest need not only a cost effective way to do that, they also need ongoing and continuing service, guidance and support . C-share mutual funds provide a win-win situation for advisor and client.

I have been an independent financial advisor since 1980. Prior to AUM fee accounts, clients had no choice other than A share commissions (then 8.5%). Paying an hourly fee for advice was not yet on the horizon for the nascent profession called financial planning. Needless to say, I did (and continue to) provide a great amount of important advice and work, for free...

Since I don't recommend B shares, the choices left are A shares or C shares. The SEC and NASD continue to "push" A shares. Why? A -shares pay me more money upfront -- how is that better for clients?? Remember, I am talking about clients with small accounts, where breakpoints have little effect.

12b-1 fees provide a tax efficient means to support the continuing service which these clients require -- in order to have any hope of a nest egg for retirement.

The benefits of 12b-1 fees:

.Investor Choice - The multiple share classes made possible by Rule 12b-1 give investors choices by providing them with options in how they pay their financial advisor. The flexibility offered by Rule 12b-1 allows financial advisors to tailor a portfolio to their client's specific needs.

.Supporting Financial Literacy - Mutual funds send their investors monthly statements, confirmations, prospectuses, annual reports, etc.

Most clients don't read this material. Ninety percent of what I do is education --helping clients make sense of these materials. 12b-1 fees are the compensation financial advisors receive for these efforts.

.Managing Client Expectations - Common mistakes investors make: buying high and selling low, chasing past performance and harboring unrealistic expectations. 12b-1 fees provide financial advisors with compensation to manage client expectations and protect them from falling into these common investor traps.

.Insuring Small Accounts Receive Service - Investment advisory services are simply out of the reach of many small account holders. Financial advisors must have another means of being fairly compensated for servicing these accounts. 12b-1 fees provide the mechanism to insure small investors receive the support and service they need to achieve their financial goals.

.Subsidizing Additional Services - Independent financial advisors like me provide a variety of services including: consolidated account statements, periodic portfolio review meetings, quarterly newsletters, cost basis research, preparation of tax returns, and consulting on other financial decisions. These important services are made possible by the subsidy 12b-1 fees provide.

While it is reasonable to review the investor benefits of 12b-1 fees, it is obvious that the repeal of 12b-1 has the potential to cause great harm to thousands of individual investors who need the support and service of a competent, ethical, experienced financial advisor.

I urge the SEC to allow Rule 12b-1 to continue to support my efforts to provide needed financial services to middle class American investors by changing it from a "commission" to a legitimate advisory fee.


Ms. Veda Cassells-Jones, CFP, AIF
C-J Advisory, Inc
2060 The Alameda
San Jose CA 95126