Subject: File No. 265-23
From: Craig McCrohon
Affiliation: Holland Knight

April 3, 2006

I am writing to comment Recommendation IV.P.6 of the Exposure Draft Final Report of the SEC Advisory Committee on Smaller Public Companies. This proposal concerned establishing a streamlined NASD registration process for finders, MA advisors, and institutional private placement practitioners.

This proposal is based significantly on a report of the American Bar Association concerning this matter. While the discussion and legal analysis within the ABA Report is thorough, the Commission should be aware that some of its legal and factual conclusions should be more completely considered prior to proceeding further.

In particular, the proposal and the ABA Report do not address the sub-segment of mergers and acquisitions advisors to smaller businesses. These small business mergers and acquisitions advisors find buyers and sellers of privately-held companies, negotiate their sale, and advise parties regarding their value. Brokers of small businesses are themselves small businesses, often operating alone or with one partner. Transactions usually involve the sale of the assets of a company occasionally they are structured as the sale of stock. Buyers might be large or medium-sized enterprises, a wealthy individual, a recently retired manager, or simply a person seeking to buy a business as an alternative to working for a large company. Sellers are the owners of small businesses.

Even the proposed streamlined NASD registration process would be a significant burden on this segment of the profession. Imposing registration, testing, record keeping and other requirements may make operating such merger advisory firms uneconomical.

Note that the ABA Report does not contain the type of factual review or foundation appropriate to regulate this small company sub-segment of mergers and acquisitions advisors. The report states that it has not systematically obtained information or evidence addressing these advisors. There has been no input from economists or other industry experts on the statistics of this professional, or a detailed explanation on the services this sub-segment provides.

While the recommendations and research may be valid for many financial and mergers and acquisitions advisors, the Commission must consider the distinction within this profession before applying a one-size-fits-all set of regulations.

The Commission should not rely solely on the conclusory factual statements within the report, but undertake an appropriate and independent study of the profession and the problems identified. Furthermore, should the Commission proceed with rulemaking or other administrative initiatives regarding mergers and acquisitions advisors, it should seriously consider exemptions for advisors working with smaller businesses, or those that focus on the sale of entire companies, rather than the simple purchase of investment securities.

Thank you for providing the opportunity to comment on the Exposure Draft Final Report.