From: michael.garcia.bvzx@statefarm.com
Sent: Tuesday, January 20, 2004 7:09 PM
To: rule-comments@sec.gov
Subject: file#SR-NASD-2003-104 Proposed NASD Rule Change re: Definition
of Branch Office

Dear     Secretary: 
I am a licensed insurance professional and variable products/mutual funds 
salesperson. I am writing to you because the NASD's proposal to revise the 
definition of branch office in Rule 3010(g)(2) will have a significant 
impact on my business.
******
This proposal will HELP THE BIG BROKERS and HURT THE BEGINNING INVESTOR!!
******
The financial expense and administrative burdens that will be caused by 
the change in status of my office from a non-branch location to a branch 
office will result in it no longer being economically feasible to offer 
variable products and mutual funds to my clients. 

This can only have a harmful impact on consumers since their access to 
these products, which often constitute an important part of my clients 
overall financial planning, will likely be reduced or eliminated.
*****
Currently, if a parent wants to begin an Education Savings Account, they 
can see me, and set one up for $50 or $100 per month.  The Big Brokers 
would NEVER talk to them--too little money for them!

Under the new rules, I would NOT BE ALLOWED TO TALK TO THEM.

I'm sure this is an unintended consequence!
*******
In addition, the NASD has not addressed the disproportionate impact that 
the proposal will have on limited purpose broker-dealers affiliated with 
life insurance companies. The proposal will have little if any impact on 
full-service broker-dealers, who typically conduct all of their activities 
from offices that meet the NASDs current definition of branch offices. 
This is appropriate since full-service broker-dealers conduct a full range 
of securities and financial activities at these offices.

However, I, a broker-dealer affiliated with State Farm Insurance Companies, 
perform a much narrower range of activities. State Farm and I have 
structured our operations based on the current definition, and we would 
be presented with significant new economic and administrative costs in 
order to comply with the new definition. 

For these reasons, I am urging the SEC to reject the NASD proposal to 
revise the definition of branch office and to keep in place the current 
definition. In the alternative, the proposal should be amended to (i) waive 
the filing fee for any non-branch location which becomes a branch office as 
a result of the proposal, and (ii) the number of permitted transactions in 
the exclusion found in section 3010(g)(2)(E) should be substantially 
increased. Thank you for your consideration of my views on this matter.


Sincerely, 


Michael Garcia
3223 Duke St Ste C 
Alexandria, VA 22314