Subject: File No. S7-25-99
From: Harry Scheyer, CPA/PFS. CFP
Affiliation: principal of own financial planning firm

January 15, 2005

As the major regulatory organization that over sees our capital formation and individual protections regarding our finances I appreciate the effort and time in reviewing and hopefully improving this area of advisory services protection.

There is no question that the public is in great need of objective and highly competent advise regarding there current and financial future. But as you know a broad range of advisors and organizations with varying intentions and competentencies is currently meeting this need.

When the fee structure changes from transactions i.e brokerage commissions to fees wrap fees etc the nature of the relationship changes. The question that the SEC has to make sure that it asks itself is what are the ramifications of this change to the public in order to protect it. What competencies must the advisor know about the financial planning process, the individual client, coordination with the clients other advisors etc. Also, what type of analysis and on goingwork must the advisor perform on behalf of that client to justify that fee be continually paid. Finally, what is that advisors fiduciary responsibility to the client.

I believe at the minimum the solution may reside in requiring a strict licensing exam, continuing education requirements with mandatory independent ethics courses on a regular basis to allow those brokers and their employees to be exempt from Registered Investment Advisors Act. Also, making sure that those advisors have a clear high level fiduciary and legal duty to those clients.

The level of proven and continuing competency, ethics and fudiciary duty not merely disclosure should be the standard at all times when fees not merely transaction charges are involved. If this is not seriously considered then the potential for harm would be much greater to the public then under the current system which I am sure you are trying to avoid by carefully deliberating this matter.

Sincerely submitted by:

Harry Scheyer, CPA/PFS, CFP