Subject: File No. SR-NASD-2006-105
From: Terry L. Lister
Affiliation: CCO, Waddell Reed, Inc.

September 29, 2006

Many NASD member broker-dealers are also registered as investment advisers. These dual registrants oftem use the types of investment analysis tools described in the amendments in connection with their financial planning process in their capacities as investment advisers. The proposed amendments do not appear to provide any guidance with respect to when Rule 2210 and IM-2210-6 will attach. Clearly, NASD does not typically assert its jurisdiction over investment adviser advertising material. For example, how will NASD staff be guided during an examination of a member's use of such tools? Where will they be told to draw the line between use by a member in its capacity as an investment adviser and in its capacity as a broker-dealer? It appears that questions such as this are not addressed in the amendments. Would it not make sense to address this in IM-2210-6 as part of the amendment process? Doing so will enable NASD to benefit from the member comment process when drafting the necessary language to guide members and the staff on application of the rule and IM to dual registrants.