Subject: File No. S7-25-06
From: Randall A Warren
Affiliation: Registered Investment Advisor

February 8, 2007

I strongly oppose raising the definition of accredited investor from $1m to $2.5m. I believe that investors should be given more choice. To segregate investors by asset size is no more fair than to segregate people by any other bias. It does not protect investors from hurting themselves when they can easily open a brokerage account and adopt the same strategies as any hedge fund by trading in future and options - which are far more complicated than say a pairs trading hedge fund.
Let the professionals do their job and advise people according to the existing rules and let's open up, not close down investor choices.
All that is needed is regular audits of assets to be sure that hedge funds are properly reporting gains and losses. Another way to accomplish that would be to enforce a separate custodian of the accounts and have all monthly/quarterly reports come direct from the cusodian as opposed to from the hedge fund itself so the hedge fund can not cover up losses.