The following comment on Letter Type B,
or variations thereof, was submitted by
45 individuals or entities on File No. SR-NASD-2003-104.

Letter Type B:

Dear Exchange Commission:

I urge you to reject a National Association of Securities Dealers' (NASD) plan to charge broker-dealers associated with a life insurance company an annual filing fee for each business location-a fee that will raise the cost of doing business. Recently, the NASD sought SEC approval of a rule change that would convert many broker-dealer non-branch offices into branch offices. The NASD currently charges a filing fee for every broker-dealer branch office. In contrast, non-branch locations do not incur filing fees under current NASD procedures.

Because most insurance-affiliated broker-dealers currently operate out of smaller non-branch locations, this proposal will have a significant financial impact on the life insurance industry. Indeed, over 50 percent of the NASD's registered representatives work for broker-dealers affiliated with life insurers.

By raising the cost of doing business, the NASD fee will impair the industry's ability to provide the kind of service that our customers need and expect. The fee does not provide increased service or consumer protection. For broker-dealers associated with life insurance companies, the new rule unnecessarily adds to the cost of doing business. The NASD failed to address these economic burdens in its request for SEC approval.

The new fee is, in significant part, a revenue raiser and is not intended to provide additional oversight or support for consumers. What the fee will do is place an unfair burden on broker-dealers conducting business through many smaller, geographically dispersed non-branch locations.

As the agency that oversees NASD, I urge the Securities and Exchange Commission to require waiver of the NASD branch office fee for broker-dealers affiliated with a life insurance company, if the rule is advanced further.

Sincerely,

http://www.sec.gov/rules/sro/nasd2003104/nasd2003104typeb.htm