Jul. 16, 2026
I am submitting this comment on behalf of a firm that provides regulatory communications and delivery services to participants across the securities industry. Because we work with issuers, intermediaries, transfer agents, and investors, we have practical experience with both electronic and paper delivery of required communications. While we support the Commission’s goal of modernizing disclosure practices and expanding the use of technology, we have significant concerns that the proposal shifts too much responsibility for successful delivery from regulated entities to investors. Our experience demonstrates that delivery is not the same as receipt. Electronic communications routinely encounter invalid email addresses, abandoned accounts, spam filtering, corporate security policies, full mailboxes, and other technical barriers that prevent investors from receiving or recognizing important regulatory communications. Although modern delivery systems incorporate numerous safeguards, no electronic channel consistently achieves universal reach. Paper delivery continues to serve an important role for investors who either prefer physical communications or who do not consistently engage with electronic channels. In practice, paper mail frequently succeeds where electronic delivery does not, particularly following changes in employment, internet providers, email platforms, or personal contact information. The proposal appropriately preserves an investor’s ability to request paper communications. However, an opt-out framework assumes that investors understand the change, receive the notice explaining it, and appreciate the consequences of taking no action. Our operational experience suggests that many investors simply do not engage with enrollment notices, making the practical effect of the proposal substantially different from an informed election of electronic delivery. We are also concerned that the proposal may inadvertently reduce the quality of delivery data available to market participants. Today’s affirmative-consent framework provides a higher degree of confidence that electronic contact information is current and intentionally maintained by the investor. Eliminating that requirement may increase the number of stale or inactive electronic delivery records over time, creating uncertainty regarding whether required disclosures are reaching their intended recipients. From an operational perspective, firms will likely continue to maintain parallel delivery infrastructures to accommodate undeliverable electronic communications, paper elections, returned mail processing, and regulatory recordkeeping. As a result, projected cost savings may not be as significant or as broadly realized as anticipated, particularly during the transition period and for firms serving large retail investor populations. If the Commission elects to proceed with a default electronic delivery model, we respectfully recommend incorporating additional safeguards, including: ● Periodic validation of electronic contact information. ● Clear performance standards for monitoring delivery failures and bounce rates. ● Enhanced investor notifications when electronic delivery repeatedly fails. ● Defined procedures requiring reversion to paper delivery after repeated unsuccessful electronic attempts. ● Periodic reminders informing investors of their continuing right to receive paper communications. Modernization of securities disclosure is an important objective, and electronic delivery will continue to play an increasingly significant role. However, modernization should be accompanied by safeguards that ensure investor communications remain reliable, verifiable, and accessible. We believe the current proposal would benefit from additional protections before adoption. We appreciate the opportunity to comment on the proposal and encourage the Commission to carefully consider the operational realities of delivering legally required investor communications.