Subject: File No. S7-08-09
From: Michael J Leider
Affiliation: Retired RR

October 16, 2009

I believe certain investors and investment organizations, namely hedge funds, are getting away with naked short sales with vulnerable low priced securities that retail customers or individual investors cannot even short. I believe that this practice can be put to rest with a simple requirement. Many Broker Dealers already have this requirement. Simply make it a law that securities that are or to be sold (before a sell order can take place) are already in street same or have been delivered and a receipt has been made or are in safekeeping with the sell side broker dealer. Once in the securities industry, I feel it is shameful that we need more regulation but the system is broken. Some broker dealers must be allowing this practice and are finding ways to hide it from regulators and authorities. I believe when large amounts of capital are involved and personal relationships exist, rules are broken but backs are turned and exceptions are made.