June 5, 2003
TO: Files
FROM: Luis de la Torre
Counsel to Commissioner Goldschmid
RE: Certain Broker-Dealers Deemed Not To Be Investment Advisers, Release Nos. 34-42099, IA-1845; File No. S7-25-99

On April 28, 2003, Sam Scott Miller, Julian Rainero, and Hardy Callcott of Charles Schwab & Co. met with Commissioner Harvey J. Goldschmid and Luis de la Torre, counsel to the Commissioner. One of the topics of the conversation concerned the Commission's proposed new rule under the Investment Advisers Act of 1940 that would address the application of the Advisers Act to brokers offering full service brokerage (including advice) for an asset-based fee instead of traditional commissions, mark-ups, and mark-downs. Messrs. Miller, Rainero, and Callcott expressed the views contained in their firm's comment letters dated January 14, 2000 and March 25, 2002 on proposed rule 202(a)(11)-1 (see Commission File No. S7-25-99).