Subject: File No. 4-606
From: Scott A Jeffries, CLU,CFP

July 30, 2010

I am writing to support the current suitability standard in comparison to a fiduciary standard. Moving to a fiduciary standard will ineviatably mean that middle America will be less served by the financial planning industry, and representatives will move to serve only the most affluent, highly educated, members of public. Often times, middle income clients feel financial pressure from all sides, whether it be credit card debt, or just the normal expenses of raising a family on an average income. Many representatives will not feel comfortable helping these clients set up accounts that are suitable and appropriate, like a ROTH IRA or a 529 plan, out of fear that a lawyer looking backwards, will determine that the client could have been better off with some other option. Often times a suitable investment or purchase is appropriate at the time of sale, but for reasons outside our control or expectations, a different option could have worked out better. It would be wrong to punish a representative who was acting in their clients best interest at the time of sale. The current standard is the most efficient way to serve the vast majority of Americans. We can only help clients purchase a suitable investment with the information we know CURRENTLY. A fiduciary standard will mean that I will have to serve less and less clients, in order to stay compliant with the increase in mandatory compliance and oversight. In medicine, there is a problem with doctors practicing "defensive medicine". This has driven up the cost of care for everyone. I fear that this change in standard will result in the financial community doing the same thing. This will hurt the consumers who can least afford the extra layer of expense that will come about. This assumes that most advisors will even still work with middle america, and not just work with just the affluent. I think most will transition their practices to a fee only basis, or work with only the most affluent. In addition, the proposed standard is far too vague and open to different applications. How do we determine what is the "best" option for our clients when there may be several options that are appropriate? Since investment returns inevitably vary, are we expected to know specifically which investment will perform the "best" in the future? It seems obvious to me that we can only control offering our clients SUITABLE investments at the time of sale and not be expected to see the future. Finally, I hold a Series 6 license, many state insurance licenses, a CLU, and a CFP designation. All of these licenses and designations require significant amounts of continuing education. I see this proposal as a solution in search of a problem and simply an unnessasary increase in regulation and red tape. This will punish honest brokers and punish middle america, while not helping anyone.