April 27, 1998

Mr. Jonathan G. Katz


Securities and Exchange Commission

450 Fifth Street, NW

Washington, DC 20549

Re: File No. S7-3-98

Dear Mr. Katz:

This is a comment letter in response to the Securities and Exchange Commission’ proposed changes to Rule 15c2-11.

We believe that with these changes, and by placing the responsibility of the veracity of the information disseminated by the issuer on the market makers, the functionality of the market maker changes dramatically from being the medium at which demand and supply will find a price point, to that of an investment advisor, investment manager, or research analyst.

The liability and the cost is so high, that many market makers will probably drop many issues and these will need to seek other alternatives for their commercialization. They will find their ways to obscure parallel markets that are totally unsupervised and the focal point for rampant fraud and manipulation, which is contradictory to the results that these changes are pursuing.

Education, efficiency, transparency, and enforcement are the requirements to thwart fraud and manipulation. It can not be that market makers should become the regulators and take on the responsibilities of those institutions and organizations that were created, specifically for that purpose.

If the changes are adopted as they stand, education will be diminished because there will be no communication in the "open and regulated" market place. Efficiency will be diminished when issuer participant will seek "other alternatives" not as efficient as the existing ones, which are the result of many years of evolution. Transparency will be non existent when investors and issuers will look for other means to raise capital and provide a "place" to buy and sell their investments. In the absence of all the prior requirements, enforcement will be much more difficult and market makers should not be made the main liable entity in this equation.

A suggestion is that the Rule 15c2-11 be maintained as it is. However, the participating market makers should provide more information on their quote montage. This information should be accessible to the public and should indicate if a market maker has or does not have current financial information for a particular issuer. If a market maker participates actively in the solicitation of the sale of an issuer or simply is facilitating price finding to meet supply and demand forces.

We feel that a close scrutiny should be made before these changes are adopted, otherwise we fear that capital formation will change radically worsening and creating more problems of the same nature that these changes are being designed to eradicate.

Sincerely yours,

Marcos Konig