Subject: File Number S7-09-09 Proposed Custody Rule Changes

July 22, 2009

Re: SEC Proposed changes to the Custody Rule

Release No. IA-2876

File Number S7-09-09

My name is Leon C. LaBrecque, and I am managing partner of the firm LJPR, LLC. We are a Registered Investment Advisor. I am a member of the FPA, as well as the MACPA, AICPA, AIMR, and the Michigan bar. I have been practicing in various functions(CPA, Attorney, Financial Advisor, Etc) since 1977. Our firm has been registered with the SEC for 20 years. Our firm has 11 employees and provides services for about 760 families.

I am initiating this communication to voice my opposition to the proposed amendment in the custody rule that subjects advisors like our firm to a surprise audit by an accounting firm.

First, it appears to me that the surprise audit rule is reactive rather than proactive. With the Madoff scandal still looming in the public’s eye, it seems apparent that the public criticism of the SEC is creating pressure on the SEC and Congress to take draconian measures. The surprise audit mechanism is not the appropriate action to protect the public from fraud of the Madoff type.

Madoff’s fraud (and other Ponzi schemes) are a result of lack of aggressive enforcement by the SEC and FINRA of rules already in existence, and clearly ignoring warnings of the media and other whistle-blowers. FINRA had shared oversight in the case of Bernie Madoff for his conduct as a broker dealer for the twenty or so years he perpetuated his fraud before becoming an RIA for the final two years.

The SEC has already resolved one of the major problems of the custody rules by eliminating the loophole from registration for certain accounting firms (PCAOB). It was that loophole that Madoff’s accountant used to avoid detection of its phony accounting practices.

The issues of Ponzi schemes have nothing to do with fees deducted by RIAs. There appears to be no systemic problems in the area of fee deduction. Madoff’s scheme was total fraud, not fee fraud.

As a small businessman, I have created more jobs in the State of Michigan than Ford, GM and Chrysler combined. Our state is highly troubled and I need all of my resources to address the issues of people losing their jobs, taking early retirements and trying to find new jobs. To impose additional costs of time and money to our firm will increase the costs to our clients of doing business. In addition, it will provide barriers to entry in the independent advisor space, giving the consumer less choice as to advisor selection.

The solution to fraud is better consumer protection. To enhance protection, I would urge Congress to appropriate additional resources for the SEC to hire and train additional examination staff to increase the regular audit cycle of investment advisors. To impose a surprise audit rule is a disincentive to business, increases consumer costs, and provides virtually no protection to consumers. To increase SEC resources and bolster the current audit cycle is a better solution.

Thank you for your time,

Leon LaBrecque