Subject: File No. S7-15-10
From: John G Thompson

November 5, 2010

For years I have puzzled about the 12(b)-1 costs. I accepted them as the cost of participating in a mutual fund and didn't concern myself with them.

At the prompting of the Motley Fools, I have read parts of the the SEC's publication "Regarding Mutual Fund Distribution Fees (File No. S7-15-10)" and now understand a bit more about 12(b)-1 fees and their history.

I can not put into polite words my reaction to understanding what where 12(b)-1 fees came from and what they are used for. I heartily agree that a financial institution deserves the profit it generates from a mutual fund, or any other endeavor it undertakes. That is profit after it has paid all of its expenses and costs of doing business.

To allow a financial institution to take fund assests to pay for " for the cost of promoting sales of fund shares." is stunning I can not fathom the reasoning that allows this cost to come out of the funds that are being promoted It is counter-intuitive.

The only benefit I see from this is that the financial institution has succeeded in taking one of its costs of doing business out of its costs column and put it on all the fund members thereby increasing its profit. The financial institution benefits at the cost of the fund members. All I have read and heard about finance screams that this is wrong. How is it that financial institutions are allowed to do this? If any non-financial institution tried to do this, it would be prosecuted and sued out of business.

The 12(b)-1 fees should be removed from the books. If a financial institution wants to advertise or promote a fund they must do so as any other business in America.

I don't believe 12(b)-1 fees should be more transparent, restricted or regulated, I believe they should be eliminated, period.