November 14, 2008

Subject: Please keep rule File No. S7-14-08

Please retain the new rule that would allow for SEC oversight of indexed annuity sales in addition to oversight by insurance commissioners.

I and a licensed financial advisor CFP® certificant in Indianapolis Indiana. I design financial plans for my clients and help them with a wide range of financial issues including investments, insurance, retirement planning. I also work very closely with my clients and other licensed professionals for planning related to taxes, estate planning, health insurance and much more.

I have encountered multiple individuals that have owned indexed annuities and become very disappointed and frustrated because they were not made aware of what they were really buying and how it could perform (I do sell annuities, but I do not sell indexed annuities for the reasons to follow).

They have told me that they were sold indexed annuities as an alternative to CDs and that they were just as safe with the returns of the market. They were not explained the dramatically increased surrender charges and surrender periods. They are often confused on how the value of the annuity varies dependent on the movement of the index. They are not explained the comparison of how an investment similar to the index would perform over a period of time similar to the surrender period compared to the indexed annuity.

I have found that in large, the sales force selling indexed annuities are not holding the same licenses as the individuals selling other investments and variable annuities that do require Series 6 and /or Series 7 license. The indexed annuities are sold as investments by individuals who are otherwise not licensed to sell investments. People buying indexed annuities think they are buying an investment and not insurance. The sale of indexed annuities should have the same or similar supervision and regulation as variable annuities. This would increase the likelihood that the sales force selling the indexed annuity would have the appropriate skills, training, licensing and oversight to responsibly present appropriate products to the consumers with appropriate disclosures, explanations and un-bias product placement.

If the only "investment" they can sell is an indexed annuity, they will sell an indexed annuity as an investment. If an indexed annuity is to be sold as an investment, then the sales force should have the same oversight as similar products such as variable annuities. If the sales force is licensed and approved to sell both indexed annuities and variable annuities (and other options), then the sale of indexed annuities and their inappropriate applications will decline dramatically because they will not fair favorably to the other options.

The supervision of annuities that carry the risk of investments already exists (variable annuities and Series 6). Consumers should not have this protection removed simple because a financial institution can design a product to avoid being under the appropriate supervision. Consumers are scared now due to the volatile economic environment. They are very vulnerable to promises of "safe investments" and this fear can preclude them from fully understanding the drawbacks to what ever option they are looking at if that option promises some kind of protection or guarantees.

Please help protect the consumer by keeping rule File No. S7-14-08 and provide the appropriate oversight to indexed annuities.

Sincerely,

Jay B. Barclay, CFP®
Financial Advisor
DCS Wealth Advisory Services, LLC