May 15, 2000

Mr. Jonathan G. Katz
Division of Investment Management
Securities and Exchange Commission
450 Fifth Street N.W.
Washington, D.C. 20549

Re: SEC Investment Adviser Roundtable (File No. 4-433)

Dear Mr. Katz:

The Securities Industry Association ("SIA") 1 appreciates the opportunity to make this submission in connection with the Division of Investment Management's Investment Adviser Roundtable on May 23, 2000. The Roundtable is just one more reflection of the Division's continuing effort to seek out the views of all segments of the financial services industry in conjunction with the development of rules and regulations which will best address the needs of investors and providers of investment advisory services in the coming years. In particular, we applaud the obvious care and thoughtfulness which the Division staff employed in developing the Roundtable agenda.

SIA has previously submitted comment letters reflecting our members views on a number of matters which are on the Roundtable agenda, including Pay to Play and Broker-Dealers Deemed Not to be Investment Advisers. Additionally, SIA will be filing a comment letter in the next few weeks on the proposed revisions to Form ADV and the new electronic filing system and database (IARD). Also, SIA has published Best Practices for Soft Dollar and Other Commission Arrangements which we believe provide effective guidelines for addressing some of the concerns set forth by the SEC examination staff in its soft dollar report issued in September, 1998, and in February, 1998 SIA filed an exemption application with the Commission to exempt certain principal transactions from the trade by trade prior consent provisions of Section 206(3). All of these documents are available (except the yet to be filed Form ADV comment letter) on SIA's website ( and we invite panelists and other interested parties to familiarize themselves with the documents prior to the Roundtable.

Given the extensive amount of material reflecting SIA views which is already available, it is not our intent to reiterate our positions in detail in this submission. Instead, with respect to certain agenda topics we have set forth below certain points we believe should be addressed to help assure that the panel discussion will be constructive and focused. We offer the following:

Broker-Dealers Deemed Not to be Investment Advisers

Pay to Play

Principal Trading

Form ADV Proposal

We are still in the initial stages of reviewing this lengthy and complex proposal. Early reactions from some of our members have focused primarily on issues such as:

These bullet points are only a summary of a few of the SIA's concerns with the ADV proposal. While our concerns will be addressed in much more detail in our comment letter, we are hopeful that some of these issues will also be addressed during the Roundtable with a view toward finding effective ways to enhance client disclosure without creating significant cost and administrative burdens on providers of advisory services, which may ultimately lead to a need to increase fees associated with such services.

We trust the above is helpful. Several representatives from SIA and its members will be attending the Roundtable, and we look forward to a stimulating discussion of the enormously important issues that will be addressed. If you have any questions please contact Michael Udoff at (212) 618-0509 or me at (202) 296-9410.


Stuart J. Kaswell

Senior Vice President and General Counsel

cc:Jeff Himstreet, Esq.
Paul F. Roye, Esq.
Cynthia Fornelli, Esq.
J. David Fielder, Esq.
Robert Plaze, Esq.
Douglas Scheidt, Esq.


1 The Securities Industry Association brings together the shared interests of more than 740 securities firms to accomplish common goals. SIA member-firms (including investment banks, broker-dealers, and mutual fund companies) are active in all U.S. and foreign markets and in all phases of corporate and public finance. The U.S. securities industry manages the accounts of more than 50-million investors directly and tens of millions of investors indirectly through corporate, thrift, and pension plans. The industry generates more than $300 billion of revenues yearly in the U.S. economy and employs more than 600,000 individuals. (More information about the SIA is available on its home page: http//