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SIGNATURE PETER CORNIOTES
TITLE ASSISTANT SECRETARY
The Board of Directors and Shareholders of
The Lexington Strategic Silver Fund, Inc.:
In planning and performing our audit of the financial statements of
Lexington Strategic Silver Fund, Inc. for the year ended June 30,
1998, we considered its internal control, including controls over
safeguarding securities, in order to determine our auditing procedures for
the purpose of expressing our opinion on the financial statements and to
comply with the requirements of Form N-SAR, not to provide assurance on the
internal control.
The management of Lexington Strategic Silver Fund, Inc. is responsible
for establishing and maintaining internal control. In fulfilling this
responsibility, estimates and judgments by management are required to assess
the expected benefits and related costs of controls. Generally, controls
that are relevant to an audit pertain to the entity's objective of preparing
financial statements for external purposes that are fairly presented in
conformity with generally accepted accounting principles. Those controls
include the safeguarding of assets against unauthorized acquisition, use,
or disposition.
Because of inherent limitations in internal control, error or fraud may occur
and not be detected. Also, projection of any evaluation of internal control
to future periods is subject to the risk that it may become inadequate
because of changes in conditions or that the effectiveness of the design and
operation may deteriorate.
Our consideration of internal control would not necessarily disclose all
matters in internal control that might be material weaknesses under
standards established by the American Institute of Certified Public
Accountants. A material weakness is a condition in which the design or
operation of one or more of the internal control components does not reduce
to a relatively low level the risk that misstatements caused by errors or
fraud in amounts that would be material in relation to the financial
statements being audited may occur and not be detected within a timely period
by employees in the normal course of performing their assigned functions.
However, we noted no matters involving internal control, including controls
for safeguarding securities, that we consider to be material weaknesses as
defined above as of June 30, 1998.
This report is intended solely for the information and use of management
and the Securities and Exchange Commission.
KPMG Peat Marwick LLP
New York, New York
August 3, 1998
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
The Schedule contains summary financial information extracted from annual
audited financial statements dated June 30, 1998 and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> JUN-30-1998
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</TABLE>
