Oct. 23, 2023
Richard Koorasingh [REDACTED] 23rd Oct 2023 Securities and Exchange Commission 100 F Street NE Washington, DC 20549 Subject: Public Comment on "Safeguarding Advisory Client Assets" Proposal Dear Securities and Exchange Commission, I am writing to express my concerns regarding the proposed rule on "Safeguarding Advisory Client Assets." While I appreciate the SEC's intention to enhance investor protections, I fear that the proposed rule may overreach the regulatory authority, potentially encroaching on areas that should be regulated by other agencies. One particular area of concern is privacy. As a client, I value the privacy and safety of my sensitive financial data and personal information, including my social security number. The proposed rule entails the disclosure of detailed custodian information, including custodial account numbers, to clients. The requirement to share this information with numerous third parties raises serious concerns about data security and the potential for misuse or unauthorized access. I believe that a balance must be struck between transparency and the protection of private information to ensure the safety of investors. Additionally, I question whether the proposed rule adequately considers the potential risks associated with such a broad expansion of the SEC's regulatory oversight. While the aim of protecting investor assets is commendable, it is crucial to assess whether the SEC has the necessary expertise and resources to effectively regulate assets beyond traditional investments. Cryptocurrency and other alternative assets present unique challenges, including the difficulty of demonstrating exclusive control. It is imperative that the SEC explores alternative options and consults with other relevant agencies with specialized knowledge in these areas to avoid unnecessary burdens on investment advisers and unintended consequences for investors. Furthermore, skepticism arises regarding the proposed amendments' impact on small entities. The upfront costs and administrative burdens associated with complying with the new rule are a significant concern for small advisers, potentially hindering their ability to operate effectively and serve their clients optimally. The SEC should carefully consider the economic impact on small entities and provide appropriate exceptions or relief measures to ensure fairness and prevent potential consolidation within the advisory industry. In closing, I urge the Securities and Exchange Commission to reconsider the potential overreach of its regulatory authority in the proposed rule on "Safeguarding Advisory Client Assets." While I support the objective of enhancing investor protections, it is essential to strike a balance that preserves privacy, avoids undue burdens on small entities, and promotes the efficient functioning of the advisory industry. I encourage the SEC to carefully consider the comments and recommendations provided to achieve a well-balanced and effective regulatory framework. Thank you for considering my concerns and allowing me to provide input on this important matter. I look forward to a productive dialogue throughout the rulemaking process. Sincerely, Richard Koorasingh