From: John Dardis
Sent: August 5, 2005
To: rule-comments@sec.gov
Subject: File No. SR-NASD-2004-183

John Dardis
P. O. Box 7186
Metairie, LA 70010

August 5, 2005

Jonathan G. Katz
Secretary, Securities and Exchange Commission Securities and Exchange Commission 100 F Street, NE Washington, DC 20549-9309

Jonathan Katz:

I am a licensed insurance professional and variable product salesperson and a principal of my firm. I am writing to you because the principal review requirements and suitability standards contained in NASD proposed Rule 2821 might be necessary, but are unworkable as presented. The Principal review timeframe cannot easily be accomplished and if a Principal takes more than the required period to review, he could well be in violation of another rule requiring prompt forwarding of the customer investment. While the intent is to allow more meaningful review and additional protection to consumers ,the execution of the proposal is fraught with impractical steps. In addition, the timeliness on the part of the insurance provider does not fit the norm of order execution since the timeframe of the investment of the funds varies from vendor to vendor.
Specifically, the timeliness of the utilization of the funds and processing time is not the same at all firms.
While it could adversely impact my business, I am more concerned that if the NASD feels there is a need for greater client protection they could allow a better approach and more realsitic review timeframe. I urge the SEC to disapprove the proposal as presented and require a more practical solution to customer protection in the issuance of both variable as well as index annuities.

I also firmly believe that people who engage in misleading sales practices should be aggressively prosecuted and subject to appropriate sanctions.
However, proposed Rule 2821 would appear to duplicate some requirements that are already in place. NASD rules already contain suitability requirements that apply to all sales of securities, including variable annuities. The insurance industryneeds to assist regulators if we really want to protect consumers. The appropriate enforcement of the existing suitability rule must be maintained.

The requirement for review by a principal found in the proposed rule would appear to present a bias against these products. These requirements may lead to constant second guessing of advice and recommendations (based upon less first hand information than was available to the sales person) which requires more time than proposed for review.

While the NASD may not have statistically quantified the scope of the problem, in my opinion, there are instances of non NASD licensed insurance persons utilizing deferred index annuities inappropriately. As proposed this rule needs to have addressed the concerns of those opposed byresponding to the comments received by the NASD. For these reasons, I urge the SEC to disapprove NASD proposed Rule 2821. Thank you for your consideration of my views on this matter.

Sincerely,

John Dardis