Subject: File No. S7-06-04
From: Robert M Wood

March 1, 2004

Major changes and regulations threaten my ability to take care of the many clients relying upon my financial experience and skills.

I appreciate the sincere desire to protect and serve the public. Accuracy and professional behavior are a must.

The 100+ pages of proposed changes to my work may seriously curtail the service I render to my clients in many ways.

One, increased paperwork on top of the lengthy paperwork added since the US Patriot Act make the task of giving excellent financial service more a matter of being an excellent paper pusher. Valuable time is being robbed from the public in mounds of paperwork that at best give the public confusion and at worst gives the public a cloudy picture as to why they are purchasing a particular financial product.

Second, fees have been disclosed for years to clients through the improved and easier to read prospectus. The cost comparison chart of load classes along with the list of expenses detail how much. This is the clients bottom line.

Most disconcerting is the proposal to eliminate the use of 12b-1 fees to compensate for distribution of funds on an ongoing basis. These fees may be reviled and listed as a pejorative to fund abuse but that is not the reality. These fees compensate professionals like myself to keep promoting the fund families to my clients with compensation for my time and effort.

The 12b-1 fee is crucial to my professional survival as a low cost provider to my clients. Please reason on a real life example of two different scenarios. Scenario 1: A client with American Funds pays a total of .70 annually to keep money invested and serviced by myself. My service includes 24 hour access to client information with my live voice on the line instead of a computer prompt. My service includes updates about the different funds and how the investments are performing using the ongoing sales material provided by the fees in questions. My service most importantly keeps the client from selling in bad times and switching at the introduction of the new fund on the block. The client remains within the fund family with limited changes and more importantly with limited costs over the long-run.

Scenario 2: NO 12b-1 fees. I am forced out of business because I cannot get paid to service my clients accounts. Unless I switch all of clients over to a fee-based arrangement. This arrangement now involves a entirely new layer of fees and costs. The fund must charge about .05 more annually in order to pay the extra administration costs. The client must now pay American management fees as well as a third party administrator for advisory fees. These fees are not the .25 12b-1 but now must be raises to at least 1 to compensate myself as well as the third party administrator. This rise in expenses is very real

Proof of this scenario can be discerned by examining the costs related to managed accounts versus plain and simple Class A loads with an on-going 12b-1 fee.

If the goal is to provide greater awareness of the fees and costs related to investments then keep it simple. The current prospectus already accomplishes this goal with easy to understand comparisons that any person can compare from one class of load to another or one fund to another.

We need to help the public read and understand the information already available to them. Give them and us greater exhortation to use the prospectus when reviewing the financial products at their disposal.

I have served my clients for 13 years. My clients stay with me because of results not because I am good at filling out needless paperwork. Please help my clients and the public at large to get the education on saving and investing.

The public greatly appreciates your service. You keep the financial viability and trust of American financial services second to none. Over-regulation and rules for the sake of rules will not improve this world class reputation. Cooperation with the financial professionals like myself will ensure long-term success for the investing public.

Thank you for your consideration of my feelings and concerns.

Rob Wood