Ready or not: lost securityholders, uncashed checks and dormant accounts
Abstract
Purpose
This paper aims to summarize the new rules requiring broker-dealers with customer accounts to search for lost securityholders.
Design/methodology/approach
The paper explains the requirement under SEC Rule 17Ad-17, beginning January 23, 2014, for any broker-dealer with customer security accounts to conduct database searches if the broker-dealer receives returned undeliverable correspondence from a securityholder; explains the requirement for any paying agent (including issuers, transfer agents, brokers, dealers, investments advisers, trustees, custodians, etc.) to send written notice to any securityholder to whom the paying agent has sent a check when the check has been uncashed for a period of 180 days.
Findings
The new rules will impact more than a thousand entities in the US.
Originality/value
The paper provides a practical explanation by experienced financial services lawyers.
Keywords
Acknowledgements
©Sutherland, Asbill & Brennan LLP. All rights reserved.
Citation
Smith, H. (2013), "Ready or not: lost securityholders, uncashed checks and dormant accounts", Journal of Investment Compliance, Vol. 14 No. 4, pp. 53-54. https://doi.org/10.1108/JOIC-10-2013-0036
Publisher
:Emerald Group Publishing Limited
Copyright © 2013, Authors