Subject: File No. S7-12-06
From: Mary C. Helburn

August 7, 2006

There should be a limit to market maker exemptions. Options makers should not be included. There should be a registration of any position, long or short that is 5% or more of company-issued shares.

Grandfathering of fails is an invitation for abuse.

The exceptions to delivery for the sake of liquidity are being used for larceny.

Pre-borrowing should be the rule. "Locate" is not a substitute for actual borrowing and is not sufficient to make the market honest.