Subject: File # S7-25-99, Propsed rule 34-42099
 
Date:    04/12/2000 9:28 AM
     
     
Dear Mr. Levitt: 
     
I will most appreciate your efforts to oppose the proposed "Merrill Lynch rule" 
that would establish a two-tiered, double disclosure standard for those of us 
purporting to seek the trust and confidence of our clients, namely financial 
advisors whether those of us who are independent investment advisors or those 
working in the so-called wirehouses. As far as a consumer is concerned, I 
suggest they are looking for expertise, sensitivity, understanding and service 
to their best interests from those supplicants seeking the job of being his/her 
financial advisor. I suggest all of us are entitled to make this search with 
standards of disclosure that do not vary based on the identity of the 
supplicant's primary employer. 
     
This is an issue that goes to the core of our country as well as the financial 
services industry. As life spans increase, our citizenry's dependence upon their
intangible financial assets increases as well. Americans must invest. Likewise 
most Americans must put their trust in others. Simply put, most individuals do 
not have both the skills or confidence to make investment decisions solely on 
their own; they will rely upon advisors to help them. Without the proper 
information to help them understand what some of the right questions might be 
for those advisors they would hope to trust, trusting people are vulnerable to 
highly evolved sales tactics and manipulation. Their personal financial security
is at risk and their quality of life along with it. 
     
Understandably, in an imperfect world, consumers cannot be assured that 
individuals they rely upon have the insights to the future that will guarantee 
positive results. But, at the very least, they should be able to understand if 
their advisors fall a short of being fiduciaries, if they might not have access 
to the resources of a major institution, if there is a possibility they might be
more salespersons than advisors or if their primary loyalties have the 
possibility of being to an entity other than the client. Disclosure cuts all 
ways, but there is simply no earthly reason consumers of financial advisory 
services should not be able to source enough information to fully understand how
their advisors get paid. There is no reason consumers should not have sufficient
access to information to enable the reasonably inquisitive to understand the 
financial incentives inherent to their advisory relationships. 
     
Indeed, the worst case scenario is the one proposed: consumers could easily be 
confused by different disclosure standards for different sources of 
advice--particularly where they concern their advisor's primary loyalties and 
motivations. I am not suggesting penalizing honest businesses. I am suggesting 
that the consumer has a right to know what can be objectively and 
non-obtrusively known about those who would seek to advise them. I also suggest 
that those of us seeking the position of trusted advisor have an obligation to 
fully disclose the nature of our businesses and compensation and to provide 
simple tools for reasonable inquiry. 
     
There is no reason all of us in financial service businesses should not provide 
the same sorts of information to consumers where the nature of advice and 
assistance being sought is precisely of the same nature and kind. 
     
Thank you for understanding and considering this important matter. 
     
Respectfully submitted, 
     
Gayle Knight Colman, CFP
     
Colman Knight Advisory Group