Subject: File No. S7-36-10
From: Jean Fullerton
Affiliation: WJM Financial, LLC

January 4, 2011

We wish to comment on the proposed elimination of the $5 million buffer regarding needing to change registration status. We strongly recommend that the SEC maintain this buffer. In fact, we recommend that the buffer be expanded to make it comparable to the existing buffer. That is, we suggest that a 20% buffer of $20 million is reasonable (equivalent to the current $5 million out of $25 million). A buffer of only 5% could be the difference in market valuations in a single day.

Not having a buffer at all has the potential of putting an unreasonable and unfair burden on the smallest SEC advisors. As an example, an RIA that is currently registered with the SEC and has $95 million in assets under management would have to change to state registration this year. Then at the end of this year, when their assets could reasonably be expected to increase 6% to over $100M, they would have to reregister again with the SEC. If the market dropped substantially the following year and the RIA went under $100M, then they would be forced again to reregister. This could mean reregistering 3 or 4 times before they finally get into a 'safe' zone. The 180-day grace period is not sufficient to prevent this problem since there is a real dilemma deciding whether to risk not having enough time to re-register with the states by delaying to try to accumulate enough assets. This has a very burdensome impact on only the smallest SEC advisors, and has no impact on the largest RIAs.

In addition, this puts additional burdens on the states that the RIA would have to register and deregister with, adding to their burden, if only temporarily.

The loss of the buffer could have a very costly and time-consuming effect on just a few of the smallest SEC registered advisors, with no discernable benefit to the investing consumer. In fact, the clients of the RIA's involved would likely be puzzled or concerned by the changes in registration.

Please reconsider your proposal and reinstate a reasonably sized buffer that would prevent an unproductive burden on those RIA's trapped in the 'twilight zone'.

Thank you for your consideration,

Jean Fullerton