From: Greg Rotman
Sent: Friday, March 14, 2003 3:56 PM
Subject: (DTC-2003-12) 
TO: Securities and Exchange Commission

REGARDING proposed rule change by DTC,

SEC Release No. 34-47365, file No. SR-DTC-2003-12

Dear Ladies and Gentlemen:

I urge you to reject the above mentioned proposed rule change by DTC, for
several reasons:

Conflicts with state corporate code. It is unconstitutional for a federal
body to implement laws or rules that interfere with the State’s ability to
govern itself. This rule would directly undermine state corporate codes.

No material effect on T+1. The Commission’s intent to implement T+1
settlement will not be effected by a small series of small company,
non-listed issues converting to X-Clearing / "Custody only" transfer, for
the following two primary reasons:

Delivery rules for NASD firms are 30 days to deliver - which is ample time
to deliver any security, including a physical security.

In today’s brokerage environment brokerages as a policy require cash or
securities on deposit prior to trading.

No chance of a "mass exodus". Since all national exchanges require DTC
eligibly as a requirement for listing, the vast preponderance of public
companies will not exit DTC for fear of losing their listing.

Inappropriate activities of DTC need to be reprimanded by the SEC, not
rewarded. DTC has acted for the last several months as though this proposed
rule was effective before submission, comment period, or approval.

Antics of DTC in court proceedings. In Amazon Natural Treasures v.
Depository Trust Company, CV-S-98-1247 - LDG-RLH-AMAZON NATURAL TREASURES,
INC., ET AL V. FIRST CONCORDE SECURITIES, ET AL, DTC demonstrates clearly
their adversarial position towards public companies, and their disrespect to
the judicial system - including refusing a court order.

DTC has lost these battles in court. See the case above, and any rule change
by the Commission could be reversed in a court given precedence listed
above.

Media and Congressional review. Any new position by the Commission that
could be interpreted as supportive towards DTC’s activities and actions will
be under intense review by the public and potentially Congress in the near
term.

Conflicts with new SEC initiatives. The SEC is planning new initiates
regarding naked short selling, which could potentially directly conflict
with this proposal.

Thanks,


Greg Rotman
CEO Sales OnLine Direct