Subject: File No. S7-06-04
From: John R Carter, CPA

April 1, 2005

The SEC has proposed new rules File number S7-06-04 that will require broker/dealers to provide customers with targeted information, at the point of sale and in transaction confirmation, regarding the costs and conflicts of interest that arise from the distribution of mutual fund shares, 529 college savings plan interests, and variable insurance products.

The adoption of these proposed rules will have substantial unintended consequences for independent broker/dealers and myself as a registered representatives. Of primary concern is that complying with the proposed rules - principally the creation and maintenance of the point of sale disclosure - will be so extremely burdensome and costly that broker/dealers will be forced to limit significantly the number of Covered Securities approved for sale. Many times, laws, rules and regulations are enacted in the name of protecting the public interests. Yet, when the regulations become so costly to administer, it is the public who are ultimately harmed by the member firms increased cost of business. In order to maintain a profitable business and continue to serve investors needs, it becomes necessary to pass along the additional costs of administering the rules and regulations imposed by the governing bodies to our customers, the investing public.

The April 4 deadline for comments does not give Mutual Service Corporation my broker dealer and other Financial Services Institute FSI members adequate time to prepare comments or discussion on the matter. The proposal was distributed for comments on March 1, but not received by FSI members until March 7. It is my humble opinion that the April 4 deadline is an attempt by the SEC to limit the responses by the Financial Services Institute members.

Although Mutual Service Corporation and other FSI members have made requests for an extension of this deadline, the SEC has thus far ignored the pleas.

I ask the SEC commissioners and their staff to allow the member firms that they oversee to consider the request for an extension of the comment period for an additional 30 days. Certainly, with all that the member firms are doing to properly educate and serve the public interests, it would only be deemed fair and proper to grant this request.
Respectfully yours,
John Carter, CPA