[ by Howard Haykin ]

The SEC adopted amendments to Rule 17Ad-17, adding subsection (g), "Due Diligence for the Delivery of Dividends, Interest, and Other Valuable Property Rights.”  The change was mandated by the Dodd-Frank Reform Act. 

By revising Exchange Act Rule 17Ad-17, “Transfer Agents’ Obligation to Search for Lost Securityholders”, the SEC has extended the requirements of Rule 17Ad-17 to search for lost securityholders. 

• In the past, only recordkeeping transfer agents had that responsibility; 
• Now, brokers and dealers will be responsible, as well. 

Unresponsive Payees.   The rule amendments also adds a requirement that “paying agents” notify “unresponsive payees” that a paying agent has sent a securityholder a check that has not yet been negotiated, along with certain other provisions and conforming language.

The amendments will become effective 60 days after the final rule release is published in the Federal Register.  The compliance date will be twelve (12) months after that date of publication.

For further details, go to:   [SEC Final Rule Release 34-68668, 1/17/13].