Subject: File Number S7-09-09

July 1, 2009

I am writing to provide comments on the proposed custody rule (IA-2876).

As a Registered Investment Adviser, my firm goes out of its way to NOT have custody of clients' funds and NOT be subject to surprise audits and additional regulations. It is my understanding that the proposed rule would make advisors who have their fees deducted directly from client accounts by third party custodians like TD Ameritrade subject to custody rules and requirements. That is ridiculous.

Deducting fees directly is simply a more efficient method of recieving payment from clients. Clients and advisors both prefer having fees deducted directly to billing the client and have him mail a check back for payment. It is more costly and inefficient for both the client and advisor. Our request to deduct fees is placed directly with the custodian who ensures that the amount is acceptable. And it is the broker/custodian who is actually deducting the fees, not our firm.

As always happens as a result of crimes by a few bad apples, the rest of the industry is saddled by innefective, cumbersome and costly regulations. This is another example of a bad proposed regulatory rule.


Richard Winer