Help needed with "unfair" charges on share certificates.

fathippy

I have a problem dealing with my late fathers shareholdings and not having the share certificates. All of the registrars are asking for fees per shareholding to cover not having them, and when this is added up over loads of small holdings the amount is quite hefty (>1000)

This seems a little unreasonable to me but they say it covers fraud and misuse of the original certificates. The trouble is, I destroyed the originals (stupidly) as I was led to believe that everything was on a register and that once identified we were ok. I vaguely remember coverage some years back talking about certificates being "a thing of the past" and everything being electronic etc etc, but this seems not to be the case. Not only that but when I spoke to the customer helpline of one of them they specifically told me to write in with a list of the shareholdings and proof of probate, but did not mention certs at all.

I have not informed my mother of this, nor do I have the funds to pay these fees. Any suggestions of what to do?

Mickygg

The sharedealing I have used is all electronic and no certificates issued - looks like it is the norm these days. Do you have any original T&C's that may expalin further charges? Otherwise they have you over a barrell and if you need the certifcates, then you will have no option but to pay.

Can you not set up the shareholdings to be interent only then you might not need actual copies of certificates?

fathippy

I agree - same here - I have never had certs, and it is not as if the companies in question are small, little known companies - these are all FTSE mainstays. I was surprised when this request arose, and especially being asked for approx £50 a go to effect any kind of transfer.

The problem with the last idea is that it would still require being transferred from the existing location, and it is that point where they are holding me to ransom!

dunstonh

Did your father use a nominee service or was he still going by the old fashioned way of having share certificates? If the latter and those certificates have gone missing then it is fair for them to charge for replacement.

This seems a little unreasonable to me but they say it covers fraud and misuse of the original certificates. The trouble is, I destroyed the originals (stupidly) as I was led to believe that everything was on a register and that once identified we were ok.

The problem is that you made an incorrect assumption and destroyed them when you shouldnt have. You assumed a nominee service when it appears your father was still doing it the old way. That is not uncommon with long term holds and the older generations.

It is not unreasonable for a company to charge for work it has to do as well as the potential risk/liability cost.

MotownFox

Is there any reason why you can not sell some of the holdings?
You will still have to pay the charges but at least they will come off the proceeds from those you wish to sell.

With those holdings you wish to keep the idea would be to mandate the dividends into the bank account of the beneficiary by the executors signing the forms that the Registrars provide. Then as and when the beneficiary wants to sell the holdings you can go through the same process as above and pay the charges applicable at that time.

This is what happens when the shares or the estate is in Trust as the holdings do not get transferred to the person entitled as they are only entitled to the income, so I can see no reason why the Registrars can not do as suggested above even though the beneficary is absolutely entitled. The only problem is that the person entitled will not be able to sign and sort it themselves each time but the Executors will have to do this. If this is a problem for the Executors then my suggestions will not be of much use. However if it is you and the beneficiary is your mother then what I suggest would work quite well as your mother selling them as and when she needs to may be better done by you than by her if the transfer had been done. There would even be the possibility if the transfer took place that your mother could lose/misplace the certificates so you would have to pay their charges AGAIN!!

fathippy

I think that is a great idea, however I suspect that they may ask for the same monies in order to sell the things. I agree that this then prolongs the cost over time, but it does not remove it.

The main gripe is that, much like the old bank charges furore, the cost does not seem to match the work required. I agree that there should be a minimum cost to open a file and tick a box or press a button etc, but when it will take a similar amount of time to do twenty things as one thing, the charges should not be cumulative. I have no qualms in paying £50 or £100 to cover the "reasonable" costs of doing this, but not £1000+.

The second issue is that the general marketing seems to be misleading. I appreciate that "newer" shareholders are taking advantage of the paperless systems, but this distinction is not made clear generally, nor is the offer to upgrade given on a regular basis. Plus on a personal level, I spoke at length with customer services who went through every last point in detail, but never once mentioned certificates.

dunstonh

I have no qualms in paying £50 or £100 to cover the "reasonable" costs of doing this, but not £1000+.

Different companies, different administration and each has its own liability. There isnt just a "press button" issue here. There is a liability issue. Each certificate will also need to be processed individually. Not on bulk. If you are not going to pay for this, then who is? Should others pay for your costs?

The second issue is that the general marketing seems to be misleading. I appreciate that "newer" shareholders are taking advantage of the paperless systems, but this distinction is not made clear generally, nor is the offer to upgrade given on a regular basis.

Its up to the consumer what service they use. They may not have been bought throug the same broker over the years or the broker may not have a nominee service. Or your father opted out of marketing or ignored marketing or the company itself didnt do marketing. Maybe your father preferred certificates. Many older people prefer that as they see the certificate as proof of ownership. Its not seen as an "upgrade" but an option.