Subject: File No. S7-12-06
From: Warren Hart

August 7, 2006

I can't understand how you can tolerate that anyone is allowed to sell shares they don't provide in the sale. In such a sophisticated business, how can you tolerate such an error in fundamentals? Please undo this "grandfather" clause where your original failure to enforce is compounded by another failure.
There has been enough abuse of the practice of short selling that a bit of overstrict reaction should be acceptable. There should be no tolerance whatever for failing to deliver a share that has been sold whether long or short.