BROKERAGE FIRM SERVICES
Customized Shareowner Search, Location,
and SEC Compliance Solutions
Keane is the #1 choice of the financial services industry for owner location and SEC Compliance. We’re also proud to be the number one choice of brokerage firms for outsourced shareowner search solutions. We have protected millions of investor accounts by offering customized communication programs that locate, update, and revitalize lost accounts before they must be reported to the states as unclaimed property. However, new “missing owner” search rules are in development. Through revisions to SEC Rule 17Ad-17 in response to the Dodd-Frank bill of 2010, all brokers will soon face a new set of requirements. Keane is ready to support brokerage firms in meeting these requirements.
#1 in SEC 17Ad-17 Compliance
Since 1997, Keane has been the number one choice of corporate stock and mutual fund transfer agents for SEC Rule 17Ad-17 compliance. That’s because our ability to reconnect individual shareholders with their accounts is unsurpassed. As the requirement is extended to include brokerage firms, we have the experience and expertise to assist the industry with proven and comprehensive compliance solutions. In fact, many brokerage firms have already proactively implemented programs to meet the new requirements. Keane is the most selected partner of these brokers because of our unique methodology that not only meets, but exceeds the required standards. More than a compliance function, they recognize shareowner location programs as an effective way to:
- Retain assets
- Improve customer communication
- Reduce returned-mail volumes
- Reduce the cost of due diligence mailings
- Minimize unclaimed property reporting costs
New Rules, New Challenges
Since it was adopted, SEC Rule 17Ad-17 has governed the manner in which corporate transfer agents, mutual funds, and other paying agents have handled lost shareholders in the early stages of the unclaimed property compliance process. With the passage of the Dodd-Frank Financial Reform Bill in 2010, Rule 17Ad-17 requirements are being extended to the previously exempt broker/dealer community. This introduces a new and potentially burdensome array of operational requirements and costs. As the leading provider of Rule 17Ad-17 compliance services for corporations and mutual funds, Keane is uniquely able to help brokers address the new requirements. Our customized solutions help ensure compliance, while maximizing the number of accounts that are protected from escheatment. These solutions allow brokers to:
- Ensure compliance with all requirements of SEC Rule 17Ad-17.
- Dramatically reduce compliance costs for location, mailing, and operational resources.
- Locate and retain lost customers, retaining their assets under management that would otherwise be escheated.
Ensure Compliance: What are the requirements?
Like transfer agents, brokers will need to comply with SEC Rule 17Ad-17 by conducting up to two shareowner searches in an attempt to locate account owners once their accounts are coded as “lost” or “returned from post office” (RPO) because mailings sent to the address of record are returned as undeliverable. The first search must take place between 3 and 12 months of being coded as lost; the second (if necessary) must be conducted between 6 and 12 months from the first. If the owner is deceased, or not a natural person (i.e. a corporation, trust, or partnership), the account is excluded from the requirement. Accounts less than $25.00 in value are also excluded.
The Dodd-Frank bill also expanded the scope of the Rule to require action when checks remain uncashed. Specifically, an account owner is considered missing if a check is sent to the address of record and it is not negotiated before the earlier of 6 months after the sending of the not-yet-negotiated check, or the broker sending the next regularly scheduled check.
For more information on SEC Rule 17Ad-17 and the impact on unclaimed property compliance, visit our Unclaimed Property Blog.
Questions on our Shareowner Search Services for Brokerages? Call us at 800-848-8896 to speak with an Unclaimed Property specialist or send us an email at questions@KeaneUP.com.