Subject: File No. S7-3-98
Date:    4/27/98 11:03 PM
     
     
                                  April 27,1998
     
Dear Mr. Katz:
     
        For over 20 years I have  been involved in the purchase and sale of
microcap equities, first as a broker at Lazard Freres and now as a portfolio 
manager for a limited partnership. While I believe the proposed  changes to 
15c-2-11 are well intentioned,they  would  cause enormous problems for 
legitimate money managers such as  me, with little positive offset.
 
       I have examined the proposals in some detail and feel that instead of
restraining fraudulent behavior  they would create massive illiquidity, making 
it impossible for me to invest in these microcaps. In addition to depriving me 
of my livelihood  the changes would make it impossible for thousands  of
small companies  with reputable managements to enjoy the benefits of being 
publically traded.

      To often I note that the well-meaning efforts of  government have
disasterous  results  because they are not thought through. The recent repeal 
of the Boren ammendment is a case in point. I urge you in the strongest 
possible terms to rethink these rule proposals.
     
                                          Sincerely,

             
                                          Nelson Obus
                                          President
                                          Wynnefield Capital