Developments in Securities Regulation, Corporate Governance, Capital Markets, M&A and Other Topics of Interest. MORE

Section 929W of the Dodd-Frank Wall Street Reform and Consumer Protection Act added subsection (g), “Due Diligence for the Delivery of Dividends, Interest, and Other Valuable Property Rights,” to Section 17A of the Securities Exchange Act of 1934, or the Exchange Act. Subsection (g) directs the SEC to:

  • Revise Exchange Act Rule 17Ad-17, “Transfer Agents’ Obligation to Search for Lost Securityholders” to extend to brokers and dealers the requirement of Rule 17Ad-17 to search for lost securityholders;
  • Add to Rule 17Ad-17 a requirement that “paying agents” notify “missing securityholders” in writing that the paying agent has sent the missing securityholder a check that has not yet been negotiated;
  • Add to Rule 17Ad-17 an exclusion for paying agents from the notification requirements when the value of the not-yet-negotiated check is less than $25; and
  • Add to Rule 17Ad-17 a provision clarifying that the written notification requirements shall have no effect on state escheatment laws.

Subsection (g) also requires the Commission to “adopt such rules, regulations, and orders necessary to implement this subsection no later than one year after the date of enactment of this subsection.” The SEC has published for comment proposed amendments to Rule 17Ad-17 to implement the statutory requirements.

Check dodd-frank.com frequently for updates on the Dodd-Frank Act and other important securities law matters.

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Photo of Steve Quinlivan Steve Quinlivan

Steve has a strong reputation in M&A, securities and international transactions, offering a rare combination of excellence and value who presents well to boards. Steve represents clients across the United States in mergers and acquisitions, ESOPs, REITs, securities regulation, securities offerings, international transactions…

Steve has a strong reputation in M&A, securities and international transactions, offering a rare combination of excellence and value who presents well to boards. Steve represents clients across the United States in mergers and acquisitions, ESOPs, REITs, securities regulation, securities offerings, international transactions and financing matters. He uses his deep background in law, finance, accounting and project management to complete his clients’ most strategically important and challenging assignments.

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