Subject: File No. S7-09-09
From: Brent R Brodeski
Affiliation: Managing Director, Savant Capital Management Inc

June 12, 2009

I would like to register my objection to changing the definition of Advisors with Custody to include those Advisors who are only deemed to have custody because they are able to deduct fees directly from the client accounts.

Advisors with Custody clearly belong in a high risk group. The potential for fraud is greatly magnified when one entity not only holds the assets, but is responsible for all reporting to the client.

This is not the case with Advisors deemed to have Custody. Multiple checks and balances are already in place:

The fee schedule and deduction policy is defined and documented in the Advisors Form ADV.

Transparency for the arrangement is evidenced in both the Investment Advisory Agreement and in the custodial limited power of attorney documents the client must sign to allow the Advisor to trade and deduct fees directly from their account.

The Assets Under Management and the fee calculation are detailed on the invoice sent out to clients.

The invoice is mailed out to clients prior to the fees being deducted.

The clients receive statements from both the Advisor and the custodian, so there are no hidden costs or transactions.

Additionally, on the Custodian side, the Custodian assists with setting up the bank accounts where fees will be transferred. Signers on these accounts are typically Senior Management and employees do not have the authority to request transfers (for fees to be deducted OR refunded) on their own.

For firms that currently fit the low risk rating, it is an unreasonable burden and expense to require an annual surprise audit. This would in no way, decrease the threat of fraud to the public, or increase the scrutiny of or the ability to examine high risk firms. It also would increase the burden on the SEC enforcement division, which currently is not able to examine 100% of the firms it has already rated as high risk

We seem to be forgetting that when trying to protect the public, it makes sense to categorize firms by their risk assessment, and to allocate the greater enforcement resources to those areas of greatest risk. Yes, it does appear there is a need to increase the size of the enforcement division as it has not kept up with the growth in the number of Investment Advisors, but doubling the size of the pool by essentially eliminating the risk rating, will inevitably lead to failure.

I respectfully ask that you carefully consider my objections to this proposed rule.