From: Cathy Sommers [cathy@ifs-ltd.com]
Sent: Friday, May 07, 2004 1:28 PM
To: rule-comments@sec.gov
Subject: File Number S7-09-04

My name is Mark Smith, and I have been a Registered Representative for fifteen 
years.  I am a Certified Financial Planner, and offer comprehensive financial 
planning services as well as investment management to individuals and 
families.

I currently manage approximately $120,000,000, and have well over 200 clients.  
Some of these clients have multi million-dollar portfolios, while many of them 
have relatively small investment portfolios.  Should Rule 12b-1 be rescinded, 
the vast majority of my large clients would be placed in asset management 
accounts that deduct investment management fees quarterly.  Our broker dealer, 
Mutual Service Corporation, has several brokerage account arrangements that 
provide accounting for asset management fees.

However, most of my small clients would not qualify for asset management 
brokerage accounts, due to small investment balances.  Many of them would be 
unable and/or unwilling to pay investment management fees directly, and I 
would therefore not able to be compensated for taking care of these smaller 
accounts.  The bottom line is that these smaller clients would wind up not 
receiving investment advice.

The record will show that the risk/reward ratio for the investments I manage 
for all clients (small and large) has been quite good.  Numerous studies show 
that many lay investors have no clear investment strategy, are not aware of 
how style drift affects their returns, and/or engage in market timing (much to 
their detriment).  I believe that I provide value to the portfolios of small 
investors, and am willing to work with them, if I am compensated.  

I believe that the rescission of Rule 12b-1 would be detrimental to the 
financial health of millions of small and medium American investors.

I appreciate the opportunity to provide this input, and would be more than 
happy to answer any questions you may have. 


-- 
Cathy Sommers
Intregrated Financial Strategies