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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
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                                    FORM 10-K
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      |X|   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2007



                                       OR

      |_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO



            Commission File Number of issuing entity: 1-32867

       STRATS(SM) TRUST FOR ALLSTATE CORPORATION SECURITIES, SERIES 2006-3
           (Exact name of issuing entity as specified in its charter)

                     SYNTHETIC FIXED-INCOME SECURITIES, INC.
        (Exact name of depositor and sponsor as specified in its charter)

                New York
(State of incorporation or organization                52-2316399
         of the issuing entity)             (IRS Employer Identification No.)

     One Wachovia Center
    301 S. College Street
  Charlotte, North Carolina
    (Address of principal              28288               (704) 374-6611
      executive offices)            (Zip Code)           (Telephone Number)

                         SECURITIES REGISTERED PURSUANT
                          TO SECTION 12(b) OF THE ACT:

Title of Class                                   Name of Registered Exchange
--------------                                   ---------------------------

STRATS (SM) Certificates, Series 2006-3            New York Stock Exchange
                                                           ("NYSE")

                         SECURITIES REGISTERED PURSUANT
                        TO SECTION 12(g) OF THE ACT: NONE

      Indicate by check mark if the registrant is a well-known seasoned issuer,
as defined in Rule 405 of the Securities Act.                     |_| Yes |X| No

      Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act.               |_| Yes |X| No

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      Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.                         |X| Yes |_| No

      Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (ss. 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.                                |X|

      Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer or a smaller reporting
company. See definition of "large accelerated filer," "accelerated filer" and
"smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer |_| Accelerated filer |_| Non-accelerated filer |X|
Smaller Reporting Company |_|

      Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).                       |_| Yes |X| No

      State the aggregate market value of the voting and non-voting common
equity held by non-affiliates computed by reference to the price at which the
common equity was last sold, or the average bid and asked price of such common
equity, as of the last business day of the registrant's most recently completed
second fiscal quarter.

      Not applicable.

                       DOCUMENTS INCORPORATED BY REFERENCE

      List hereunder the following documents if incorporated by reference and
the part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document
is incorporated: (1) Any annual report to security holders; (2) Any proxy
information statement; and, (3) Any prospectus filed pursuant to Rule 424(b) or
(c) under the Securities Act of 1933. The listed documents should be clearly
described for identification purposes (e.g., annual report to security holders
for fiscal year ended December 24, 1980).

      None.

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                                     PART I

The following Items have been omitted in accordance with General Instruction J
to Form 10-K:

      Item 1. Business.

      Item IA. Risk Factors.

      Item 2. Properties.

      Item 3. Legal Proceedings.

      Item 4. Submission of Matters to a Vote of Security Holders.

Item 1B. Unresolved Staff Comments

      None.

                                     PART II

The following Items have been omitted in accordance with General Instruction J
to Form 10-K:

      Item 5. Market for Registrant's Common Equity, Related Stockholder Matters
      and Issuer Purchases of Equity Securities.

      Item 6. Selected Financial Data.

      Item 7. Management's Discussion and Analysis of Financial Condition and
      Results of Operations.

      Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

      Item 8. Financial Statements and Supplementary Data.

      Item 9. Changes in and Disagreement with Accountants on Accounting and
      Financial Disclosure.

      Item 9A. Controls and Procedures.

Item 9B. Other Information.

      None.

                                    PART III

The following Items have been omitted in accordance with General Instruction J
to Form 10-K:

      Item 10. Directors and Executive Officers of the Registrant.

      Item 11. Executive Compensation.

      Item 12. Security Ownership of Certain Beneficial Owners and Management
      and Related Stockholder Matters.


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      Item 13. Certain Relationships and Related Transactions.

      Item 14. Principal Accountant Fees and Services.

Substitute information provided in accordance with General Instruction J to Form
10-K:

Item 1112(b) of Regulation AB. Significant Obligors of Pool Assets (Financial
Information).

      The Allstate Corporation, the issuer of the underlying securities, is
subject to the information reporting requirements of the Securities Exchange Act
of 1934 (the "Exchange Act"). For information on The Allstate Corporation please
see its periodic and current reports filed with the Securities and Exchange
Commission (the "Commission") under its Exchange Act file number, 001-11840. The
Commission maintains a site on the World Wide Web at "http://www.sec.gov" at
which users can view and download copies of reports, proxy and information
statements and other information filed electronically through the Electronic
Data Gathering, Analysis and Retrieval system, or "EDGAR." Periodic and current
reports and other information required to be filed pursuant to the Exchange Act
by The Allstate Corporation may be accessed on this site. Neither Synthetic
Fixed-Income Securities, Inc. nor the Trustee has participated in the
preparation of such reporting documents, or made any due diligence investigation
with respect to the information provided therein. Neither Synthetic Fixed-Income
Securities, Inc. nor the Trustee has verified the accuracy or completeness of
such documents or reports. There can be no assurance that events affecting the
issuer of the underlying securities or the underlying securities themselves have
not occurred or have not yet been publicly disclosed which would affect the
accuracy or completeness of the publicly available documents described above.

Item 1114(b)(2) of Regulation AB. Credit Enhancement and Other Support, Except
for Certain Derivatives Instruments (Financial Information).

      None.

Item 1115(b) of Regulation AB. Certain Derivatives Instruments (Financial
Information).

      None.

Item 1117 of Regulation AB. Legal Proceedings.

      There are no legal proceedings pending, or any proceedings known to be
contemplated, by governmental authorities against the depositor, the Trustee or
the issuing entity, or any property thereof, that is material to the holders of
the Certificates.

Item 1119 of Regulation AB. Affiliations and Certain Relationships and Related
Transactions.

      In accordance with the Instruction to Item 1119, affiliations and certain
relationships and related transactions are described below in response to this
item.

      Wachovia Bank, National Association ("Wachovia Bank") is the "Swap
Counterparty" with respect to its obligations under the ISDA Master Agreement
including the Schedule thereto and a confirmation thereunder, by and among the
Swap Counterparty and the issuing entity, dated as of April 28, 2006. Wachovia
Bank is the "IRFC Counterparty" with respect to its obligations under the
Interest Rate Forward Contracts, by and among the IRFC Counterparty and the
issuing entity, each of the thirteen contracts occurring monthly from May 2006
until and including May 2007. Wachovia Bank is an affiliate of Synthetic
Fixed-Income Securities, Inc., the sponsor of the issuing entity and the
depositor of the issuing entity and Wachovia Capital Markets, LLC, who acted as
an underwriter of the Certificates issued by the issuing entity.


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      The Trustee is unaffiliated with, but may have normal banking
relationships with, the sponsor, the depositor and their respective affiliates.

Item 1122 of Regulation AB. Compliance with Applicable Servicing Criteria.

      The Trustee has been identified as a party participating in the servicing
function during the reporting period with respect to the pool assets held by the
issuing entity. The Trustee's report on an assessment of compliance with the
servicing criteria applicable to it during the issuing entity's fiscal year
ending December 31, 2007 and an attestation report by a registered independent
public accounting firm regarding the Trustee's related report on assessment are
attached as exhibits to this Form 10-K. The report on assessment and related
attestation report have identified material instances of noncompliance with the
servicing criteria set forth in Item 1122(d)(2)(i) of Regulation AB, as
described in each such report.

      While Regulation AB does not contemplate identifying noncompliance on an
individual transaction basis, the Trustee has verbally confirmed to the
depositor that no instances of noncompliance with Regulation AB were discovered
with respect to the STRATS trusts that were part of the statistical sample used
in preparing the Trustee's report. The Trustee has informed the depositor that
the Trustee cannot provide any assurances that had an analysis been done of each
and every transaction included in the platform (including all STRATS trusts
forming part of the platform), that additional instances of noncompliance would
not have been discovered. However, the Trustee has informed the depositor that
it has no reason, based on the sampling and analysis done, to believe that there
are any instances of noncompliance with those STRATS trusts that were not part
of the sampling procedures.

Item 1123 of Regulation AB. Servicer Compliance Statement.

      The Trustee has provided a compliance statement, signed by an authorized
officer, attached as an exhibit to this Form 10-K.

                                     PART IV

Item 15. Exhibits, Financial Statement Schedules.

      (a)   List of Documents Filed as Part of this Report

            (1)   Not Applicable.

            (2)   Not Applicable.

            (3)   See Item 15 (b), below.

      (b)   Exhibits Required by Item 601 of Regulation S-K.

4.1   Series Supplement, dated as of April 28, 2006 (incorporated by reference
      to Exhibit 4.1 of the Issuing Entity's Current Report on Form 8-K filed on
      May 12, 2006).

31.1  Rule 13a-18/15d-18 Certification (Section 302 Certification).

33.1  Report on Assessment of Compliance with Applicable Servicing Criteria of
      The Bank of New York for the year ended December 31, 2007.

34.1  Independent Accountants' Attestation Report concerning servicing
      activities of The Bank of New York for the year ended December 31, 2007.

35.1  Compliance Statement of The Bank of New York for the year ended December
      31, 2007.

      (c)   Omitted.


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                                   SIGNATURES

      Pursuant to the requirements of Section 13 of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

                                 Synthetic Fixed-Income Securities, Inc.
                                 (Depositor)


Dated: March 28, 2008            By:  /s/ James Whang
                                      --------------------------------------
                                      James Whang
                                      Director
                                      (senior officer of depositor in charge of
                                      securitization)


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                                  EXHIBIT INDEX

EXHIBIT              DESCRIPTION

4.1                  Series Supplement, dated April 28, 2006 (incorporated by
                     reference to Exhibit 4.1 to the Issuing Entity's Current
                     Report on Form 8-K filed on May 12, 2006).

31.1                 Rule 13a-18/15d-18 Certification (Section 302
                     Certification).

33.1                 Report on Assessment of Compliance with Applicable
                     Servicing Criteria of The Bank of New York for the year
                     ended December 31, 2007.

34.1                 Independent Accountants' Attestation Report concerning
                     servicing activities of The Bank of New York for the year
                     ended December 31, 2007.

35.1                 Servicer Compliance Statement of The Bank of New York for
                     the year ended December 31, 2007.


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