September 29, 1998

The Honorable Arthur Levitt, Jr.
Chairman
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Mr. Frank Zarb
Chairman and CEO
National Association of Securities Dealers, Inc.
1735 K Street, N.W.
Washington, D.C. 20006

Dear Chairmen Levitt and Zarb:

I am writing with reference to today's hearing before the Subcommittee on Finance and Hazardous Materials and to commend you for your commitment to achieving greater price transparency and investor protection in the corporate debt market.

When H.R. 10 passed the House in May of this year, it contained a provision requiring the Federal financial regulators to look at their existing disclosure rules and, where necessary, to prescribe new rules or changes to existing rules that would improve the accuracy, simplicity and completeness of the disclosure of commissions, fees, markups, and other costs incurred by customers in the purchase of financial products. But a funny thing happened in the Senate. The Senate Banking Committee deleted this pro-consumer provision under intense lobbying by The Bond Market Association who claimed that investors would be "confused" by this information. However, today's written testimony by the SEC states at page 8: "[i]mproved transparency done correctly will not confuse investors" and "the Commission's goal is to protect the interests of investors by tailoring requirements to the manner in which bond markets operate."

The Bond Market Association testified on the record today that they now "are committed to working with the SEC and NASD to improve the availability of corporate bond price information." To assist us in evaluating the truth of that commitment, I respectfully request that the SEC and NASD submit an annual progress report to this Committee in September of each year through 2003. Those reports shall discuss not only your initiatives but also those of the industry and, as appropriate, should include an evaluation of their level of cooperation and support, toward accomplishing our common goal of ensuring that investors have access to the best possible price information before they make investment decisions.

Thank you for your attention to this matter.

Sincerely,

JOHN D. DINGELL
RANKING MEMBER

cc: The Honorable Tom Bliley
The Honorable Michael G. Oxley
The Honorable Thomas J. Manton

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