Subject: File No. S7-06-03
From: Robert Callahan, Jr
Affiliation: Attorney at Law

August 12, 2006

NFI and OSTK are blatantly manipulated everyday. The fails to deliver revealed in these stocks through the FOIA are startling. How is one not to get the impression that the SEC is asleep at the wheel.

Why were all previous fails to deliver "grandfathered" in? Why has the SEC taken NOT ONE enforcement action against the hedge funds and broker dealers who continue to to violate REG SHO?

Hedge funds are daily allowed to use tactics designed to drive thinly traded companies to bankruptcy. It is quite transparent to even the most casual observer. Illegal naked short selling and attacking the bid through the ECN's happens almost daily in NFI and OSTK. You think hedge funds don't need to be regulated? The SEC has been co-opted by Wall Street's big money. Aguirre's testimony before congress was startling

I thought the function/mission of the SEC was to protect individual investors. After watching all the events of the past 2 years after the passing of REG SHO, it has become apparrent that the SEC is more concerned with the protection of Wall Street, Hedge Funds, and criminals.

Please do something to restore our faith in the american markets. I.E. Force buy ins of the fails at T+3. Investigate broker dealers who hide the fails ex-clearing.

Thank you for your time

Robert Callahan