July 8, 2009
Dear SEC Commissioners;
I fully disagree with this proposal’s assertion that being able to deduct a fee constitutes custody of assets. My assets are held at Fidelity Investments, an independent and verifiable custodian. An audit is an unnecessary expense and would not create a better solution for clients. Please be aware that it would be an extreme burden to most federally registered investment advisers to undergo annual surprise audits by an independent public accountant.
While I strongly support the need to strengthen investor protection in light of the Madoff scandal and other Ponzi schemes, we believe the best approach is to give the SEC the resources it needs to audit advisory firms, not outsource that responsibility. In addition, the approach taken by the SEC in this rule is directed at a problem that does not exist.
Order advisors to maintain an independent custodian – that will solve your problem.
SCOTT P. NOYES, CFA®CFP®
Chartered Financial Analyst™
Certified Financial Planner™
NOYES CAPITAL MANAGEMENT, LLC