December 5, 1989
TO: BOARD OF GOVERNORS NO. 72-89
SEC RULES MEMBERS NO. 65-89
RULE 12b-1 AD HOC COMMITTEE
RE: NASD PROPOSAL REQUIRING DISCLOSURE OF CDSL ON CONFIRMATION
STATEMENT
__________________________________________________________
The NASD has proposed an amendment to its Rules of Fair
Practice to require disclosure on confirmations when an
investment company imposes a deferred sales load on redeemed
shares. Attached is a copy of the proposed amendment.
The purpose of the amendment is to ensure that investors
who rely on the oral representations of brokers and do not study
the prospectus are aware of the possibility of a sales load upon
redemption. The NASD Board of Governors believes that disclosure
on confirmations will help alert investors to the possibility of
a sales charge before paying for their shares.
The comment period for the proposed amendment ends on
January 2, 1990. Please provide me with any comments that you
may have by December 22, 1989.
Amy B. Rosenblum
Assistant General Counsel
Attachment