Subject: File No. S7-24-99 (Input)
Author:  Robert Thomas, rkitchen50@aol.com 
Date:  12/26/99
     
     
To SEC Representatives,
RE:  File No. S7-24-99
     
I fully support the new requirement for all companies traded on the 
OTCBB to file regular 10-Q and 10-K with the SEC.  I believe all public 
companies have an obligation to fully disclose its financials to the 
public.
Shareholders are in fact owners of these public companies and they have 
the right to know public company operations.  I fully applaud the action 
taken by the SEC against the Internet Frauds committed by some insiders 
and stock promoters in an attempt to take advantage of the public.
  However, I do believe the biggest threat to the OTC BB market order
is the outrageous stock price manipulation by some market makers and 
foreign brokerage firms.  Particularly, illegal shorting
(creating shares to sell short) has been, in my view, the biggest fraud I 
have ever seen in the stock market.
  When a company has only 10 million outstanding shares and some
brokerage firms sell unlimited non-existent shares, how could a market 
order be established?   If the SEC is really serious about protecting the 
public from any fraud and is willing to fight against these big firms, 
the SEC should regulate short sales in any stock markets as listed stocks.  I 
     
just want everybody to play the game with the same rule.  I believe the 
overall valuation of OTCBB stocks should go up 30% if short sales are 
regulated.
     
**Extending the Short Sale Rule to Non-Exchange Listed Securities
Current short sale regulations cover securities that are either listed on 
an exchange or traded in the Nasdaq NMS.  As a result, they cover 
securities that are generally characterized by high trading liquidity. In 
addition, these markets have a relatively high degree of transparency. 
Securities traded in the OTC markets (e.g., Nasdaq Small Cap, the NASD's 
OTCBB, the Pink Sheets) are not subject to short sale restrictions. The 
staff frequently receives complaints alleging short sale abuses involving 
securities in the OTC markets.
Recognizie that Section 10(a) does not grant specific authority
to the Commission to regulate short sales of securities not listed on a 
national exchange.  Thus, regulations that extend short sale regulation 
to new market sectors would have to be adopted under other available 
statutory authority.  The SEC should seek regulation to regulate short 
sales in this market sector.
     
--
Sincerely,
 Robert Thomas-Kitchen