Prior to its establishment, Illinois did not recognize the benefits of knowing where each representative is physically located and being able to review the records maintained at the individual offices. Many states have only recently established audit programs and will soon be recognizing the benefits. However, as individual states establish their audit programs, they will find these abuses just as Illinois did. Had these proposed rule changes been adopted 8 years ago, it would have been more difficult, if not impossible, to detect the abuses in the 29 cases referred to previously. The public makes no distinction between one person operating a securities business from a particular location or 100 persons operating a securities business from a particular location.
Public perception is that an office is an office.
To the general public, however, there is no difference. Since the salesperson does not pay for the advertisement and only the DBA name appears, the NASD definition of branch office is avoided, yet the salesperson enjoys the same benefits as other offices of the dealer. This leads to grave problems when the office has complaints against it. Namely, confusion on the part of the investor as to who to voice their complaints to. Another result is that customers are easily convinced to write a check payable to the DBA entity of unscrupulous salespersons because that is the name the customer believes they are conducting business through.