Subject: File No. S7-06-04
From: Cathy Bataille

January 07, 2005

January 07, 2005

Secretary Jonathan Katz

Dear Secretary Katz,

As an investor advocate, I commend the Commission for its bold step to require brokers to provide pre-sale disclosure of costs and conflicts of interest when they sell mutual funds. However, I am concerned that certain aspects of the proposal, including the proposed timing, content, and format of the disclosures, need improvement.

With a few strengthening provisions, I believe this rule proposal could help investors to make more cost conscious mutual fund purchase decisions, potentially saving us tens of thousands of dollars over the life of our investments.

Specifically, the rule should provide for written disclosures at point of recommendation, rather than point of sale. The disclosure rule should also include mutual fund operation costs, including sales-related costs. Finally, disclosures need to be provided in a clear and simple manner so investors can understand them. After working in the office of a mutual fund broker for 10 years, as office manager, handling the placement of orders, sending out confirmations, and depositing payments when they were received as well as making the required payments to the funds, i still find the information provided to me as an investor, in many cases, incomprehensible!

Thanks for considering my concerns.


Mrs. Cathy Bataille