Subject: File No. S7-15-10
From: Mark D. Brost, CFP
Affiliation: , CFP, Registered Investment Advisor Registered Representative

August 19, 2010

I have been a Registered Representative for over 15 years and a Registered Investment Advisor for 10 years and a CFP for 5.

It has been my experience in reviewing client accounts that a consistent pattern can be found among poorly designed, unsuitable portfolios, where the client receives little or no ongoing guidance from the "Advisor."
The consistent pattern is that the "advisor" received all or most of their compensation when the transactions were initiated. I regularly receive visits from prospective clients with questions about their existing portfolios or service related items. They will rarely consider contacting the original salesperson and have never heard back from them(particularly if the portfolio has done poorly)

As an advisor who is licensed to do commission based, fee-based and hourly rate planning I see the need for all of the above forms of compensation depending on the situation.

For smaller portfolios of $25k I recommend the availability of a 12-b2 fee of over 25 basis points as proposed by the SEC with the exception that the shares revert to a lower fee when a combined household value of $100,000 is hit, not an accumulation of sales charge until a particular cumulative % is hit. I understand the rationale for the conversion to the 12-b2 system and agree that 12b-1 fees dont meet their original purpose.

I think it is important to note that many small investors who require advisor assistance. It is my experience that they tend to shy away from financial planning on an hourly basis unless they require significant comprehensive planning and that they don't meet the fee-based account minimums. . This leaves upfront load, backend load and level load funds for those needing advisor assistance. As stated earlier, I find many are poorly served by advisors who are only interested when there is an upfront payout to the advisor. Level loaded funds, which currently involve higher 12-b1 fees, put the advisor and client on a more equal incentive. For the advisor to retain the client and continue to receive a significant part their compensation, the client needs to continue to be satisfied that the performance and service given to the client. Given that the account balance can increase over time given growth and additional contributions, I recommend that the initial limit of $25k or less and maximum of $100k in household 12b type fees where the 25 Basis Points is exceeded.

In sum, while 12b-1 fees may need some modifications, removing the compensation model where advisors are paid-as-they-go, should not be discouraged as a result of these proposed regulations.

Thank you for your consideration.