Subject: File Number S7-09-09

July 25, 2009

I've already commented a couple of times about this rule, but recently I had this question: If we custody at TD Ameritrade, but are considered to have custody because we get our fees deducted by TD Ameritrade, and because of this we need to have a surprise audit done,

what does the auditor audit?

Do we supply them with our 400+ account numbers and then send them off to TD Ameritrade to confirm that our clients' assets are where we say they are? Does this mean that TD Ameritrade, which already gets audited, would now need to deal with some thousands of auditors sent by their investment advisors, each with their own unique way of examining a small subset of TD Ameritrade's client base?

I understand the goal to find and plug potential future loopholes, but this isn't going to be a loophole, just a huge expense item, whether we choose to get audited or (and this is where the loophole will really be) move to directly billing our clients, where no one is looking at what we do except the client.

William C. Jerome, CFP