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Ready or not: lost securityholders, uncashed checks and dormant accounts

Holly Smith (Partner, based at Sutherland, Asbill & Brennan LLP, Washington, DC, USA)

Journal of Investment Compliance

ISSN: 1528-5812

Article publication date: 25 November 2013

70

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

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