Subject: File No. S7-19-07
From: Gerald T Cullen, CFA
Affiliation: Institute of Charted Financial Analysts

July 18, 2008

Dear Gentlepersons:

Please accept these comments on the proposed change in SHO Regulations.

Naked shorts are an always have been illegal. SHO has never adequately addressed this problem and the proposed changes fall short of a cure. Failure to deliver should be a wake up call to regulators that naked shorts are most probably the cause and should not be allowed to continue. Violations should be punished.

Exempting primary dealers from SHO Regulations make no sense to me.

Use of the Canadian Exchanges Anonymous loop hole must be closed if SHO is to be effective.

Banning naked short selling on a selected basis is prejudicial to all stock holders not included in the ban. Quite simply, naked short selling is illegal and it should be because it is used to manipulate the market to the advantage of those conspiring together to the disadvantage of legitimate long term investors.

Why does the SEC tolerate any failure to deliver?