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SECZ gives investors ultimatum

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THE Securities Commission of Zimbabwe (SECZ) has given investors an ultimatum to collect share certificates being held in nominees accounts after a probe by the capital markets regulator revealed that several shares were uncounted for.

Report by Our Chief Business Reporter

A “nominee account” is a type of account in which a stockbroker holds shares belonging to clients, making buying and selling those shares easier. In such an arrangement, shares are said to be held in street name.

The ultimatum comes after the SECZ issued a directive on August 29, 2012 to all securities dealing firms (stockbroking firms) to register all shares in their nominee accounts into the names of the respective beneficiary owner by October 31, 2012. The commission, according to correspondence gleaned by NewsDay further conducted an investigation to ascertain the level of compliance with the directive and quantum of shares lying with stockbroking firms as registered unclaimed, unidentifiable and unregistered as well as undeliverable.

“The investigation has revealed that a substantial number of shares remains unclaimed and unidentifiable with the relevant beneficiary owner,” reads part of the letter seen by this paper.

“These shares could not be delivered to their respective owners due to various reasons, chief among them, lack of adequate identification and physical contact details of the shareholders upon purchase of the shares and outdated contact details upon change of residential addresses and phone numbers.

“As a result of these irregularities, the commission strongly urges members of the invested public to collect their share certificates from their respective securities dealing firms by 14 December 2012 before they are transferred to registered custodians where an underlying fee would be charged for uncollected shares.”

The decision by SECZ to call for investors to register shares held in their names was part of the far-reaching reforms by the capital markets regulator in a bid to improve efficiency and transparency of the markets.

In September, SECZ ordered local transfer secretaries to block the transfer of shares registered under the now-defunct Remo Investment Brokers and Interfin Securities in a bid to protect investor interests.

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