Subject: File No. S7-12-06
From: Joseph H Kennedy Jr.
Affiliation: Broker

April 12, 2007

4/12/07 Nancy M. Morris
Secretary, SEC
100 F. Street, NE
Washington, DC 20549-9303
re: file no. S7-12-06

Proposed Amendments to Regulation SHO

Dear Ms. Morris,

After spending twenty-three years as a stockbroker, I recently took my Series 101 continuing education class, and I felt compelled to write a letter. I found it ironic at the beginning of the ethics section that the issue of ethics was very straightforward. The gentleman on the video expressed in great detail the need to have ethical behavior in our capital markets in order to foster confidence and trust of the general investing public.

The ironic part is that there seems to be a double standard. When the SEC decided to create rule SHO and grandfather all past failures, I was astounded. This was like giving a bank robber a get-out-of-jail free card, as long as he did not rob another bank. What a briliant idea, and maybe the problem will just go away. Besides, as one comissioner stated, "Naked short selling doesn't exist, those people are just whiners- and want their stocks to go up."

Sorry, but there is a problem and the abuses of naked short selling have not gone away. They never will until trades are settled in a normal manner and not continue to fail forever. Six billion dollars a day in fails is not a small number in anyone's book. Firms caught in the ongoing charade need more than a slap on the wrist and a minuscule fine, "which they consider just the cost of doing business." These miscretes are breaking the law and they do not even admit to doing anything wrong.

The recent Bloomberg TV special, "Phantom Shares" was a welcome sight for people who have been aware of the problem for a number of years. Most of the investing public have been kept in the dark for all these years. Now that the secret is starting to get out, the investing public is sure to question the ethics of a broken system. We can only hope other mainstram programming will have the guts to follow suit and inform the public of this unethical, unlawful behavior. It's a double-edged sword, but I for one am sick of the rhetoric from our regulatory agencies.

In conclusion, I hope the SEC can develop some backbone under the leadership of Chairman Cox and put an end to the unethical, unlawful abuses brought on by naked short selling. We will never know how many great products or services we may have lost due to the abuses- not to mention the jobs, revenue, taxes, etc., and the toll this has taken on the economy. By illegally destroying companies before they have a chance to survive, you are destroying the foundation of our capital markets.

It's no wonder that our IPO market is in a major decline and the U.S. markets are taking a backseat to other countries.

Respectfully yours,

Joe Kennedy