February 6, 1989
TO: INVESTMENT ADVISERS COMMITTEE NO. 7-89
SEC RULES COMMITTEE NO. 11-89
UNIT INVESTMENT TRUST COMMITTEE NO. 6-89
RE: NASD PROPOSAL TO RESTRICT PAYMENT OF REFERRAL FEES
__________________________________________________________
As we previously informed you, the NASD has proposed a
rule amendment that would impose restrictions upon payments
of referral fees to unregistered parties. Attached is the
Institute's comment letter to the NASD on the proposal. In the
letter, the Institute requests that (1) payments for customer
lists not be limited to fixed fees, (2) payments to banks be
exempted from the restrictions and (3) payments by investment
advisers under solicitation agreements pursuant to Advisers Act
Rule 206(4)-3 be specifically excluded.
We will keep you informed of developments.
Craig S. Tyle
Assistant General Counsel
Attachment