Subject: File No. S7-25-99
From: Norman M Boone
Affiliation: President, Boone Financial Advisors

August 24, 2004

RE: SEC Rule Exemption for Broker-Dealers


I am writing to express my concern that the current proposed rule does not protect consumers well because it allows broker-dealer firms to say one thing and do something else. Many such firms actively advertise their financial planning capabilities and that their advice takes into account a clients goals and life circumstances. Such advertisements often also claim to offer such services on a fee basis. The reality is quite different.

Consumers are confused. If they are looking for brokerage services, then advertising ought to say that is what they will be getting. If they are looking for more comprehensive services, they they ought to be regulated for same. Some advisers are regulated for one set of behaviors, others advertise those same behaviors but are regulated differently. If the SEC cant figure it out, how can consumers be expected to differentiate between them?

Ultimately, the problem is an inconsistent requirement to disclose. Lacking consistency, the public is always going to be confused, which they certainly are on this issue.

The SECs failure to enforce existing rules and its announced intention to act on the proposed rule has significantly magnified the publics confusion. Consumers have a right to clearly understand the rules under which financial advisors operate and expect that all such advisors operate under the same rules. Fair, full and equal disclosure is a public right. The proposed rule and the SECs failures have violated this basic consumer right.

Whether an advisor is part of a broker-dealer or an independent registered investment advisor, the consumer has a right to expect them to be subject to the same rules which are intended to protect the consumer. Which employer the advisor works for should not be the deciding factor as to what protections the consumer can expect.

Thank you for your consideration.

Norman M. Boone