Subject: File No. S7-09-09
From: Henry Lester, CFA

July 8, 2009

Implementation of the proposal would be very costly both in terms of direct costs and time spent complying with the rule and yet would not provide significant benefits, since misappropriate of client funds is small and limited with respect to withdrawal of fees from client accounts. Specifically, our custodian, Schwab, monitors the fee withdrawal requests in terms of size and frequency in order to guard against inappropriate behavior on the part of advisors. Thus, as a practical matter the potential loss is minimized. Alternatively, fees withdrawn from client accounts could be exempted from custody rules, if they are billed in arrears. Such an arrangement protects the client by providing additional time to reveiw statements before paying for services and does not put the client in the position of having to seek a refund for services that have not been provided. Such a quarterly billing process is more consistent with the requirement that a third party custodian provide the client with at least quarterly statements.