Subject: File No. S7-25-06
From: Richard W Persons

January 26, 2007

I believe the whole concept of the "accredited" investor is basically discriminatory just like age, gender or sexual orientation issues. Who is to say that a person of a certain level of financial resources possesses the appropriate level of financial acumen to discern the relative merits of an investment option? The proposed rule change the SEC is considering will perpetuate and further aggravate a system which effectively deprives the "average investor" of the same options in their investment decisions as the supposed accredited investor now possesses. Net worth should not be the criteria for people to have available to them the sophisticated investment options in the market today.

Under a regulatory environment, the SEC should offer the hedge fund industry and/or the private equity fund industry the option to submit to regulatory restrictions and/or requirements. Should any or all of these funds agree to regulation, the SEC can then set out the disclosure requirements for those funds in order to offer their instruments to the investors in the US - without regard to their assets, but with them being made fully aware of the nature of the investment, its risks and its rewards. If the individual investor without regard to assets is allowed to invest in futures contracts, options, etc. then many of the existing hedge funds and/or private equity funds truly operate in a much more predictable risk range.

If England and/or the European Union can devise ways to regulate and control these types of investments such that the individual investor (without regard to some arbitrary asset level) can have the option to invest in these types of instruments, then I see no reason why the SEC ought not to be pursuing that course as well.

The proposed rule change the SEC is considering at this time would more firmly perpetuate a discriminatory system that precludes an investor (regardless of assets) from even considering certain investment instruments which may compliment or significantly enhance his overall portfolio performance. It is tacitly unfair for an arbitrary asset value criteria to be applied to the eligibility of any single individual to invest in any investment instrument assuming there is adequate disclosure and the investor acknowledges the disclosure documentation.

This is a classic example of "more big government intrusion" into its citizens' lives as opposed to the Bush administation's supposed claim to "less" big government. Let the market place decide. If a hedge fund operator is willing to submit to certain basic and appropriate rules of disclosure, then any investor who deems their offering to be appropriate for their respective portfolio should have the option to invest.