Shares forfeited

aspiespender1

I wonder if anybody knows what my entitlement might be.

i discovered that I had lost share certificates for 25 year old shares! Following it up with the registrar (equinity), I’ve learned my holdings in both company’s were forfeited (within the past three years). I had received a letter from ProSearch but it looked like a scam to me… and no indication that the shares could be forfeited.

annoyingly the shares were sold at a very low point which seems cheeky!

anyway- I don’t know the law about this … presumably I can get the cash equivalent of these forfeited shares back - it feels like it would be theft if not, but I’m scared!

wmb194

aspiespender1 said:

I wonder if anybody knows what my entitlement might be.

i discovered that I had lost share certificates for 25 year old shares! Following it up with the registrar (equinity), I’ve learned my holdings in both company’s were forfeited (within the past three years). I had received a letter from ProSearch but it looked like a scam to me… and no indication that the shares could be forfeited.

annoyingly the shares were sold at a very low point which seems cheeky!

anyway- I don’t know the law about this … presumably I can get the cash equivalent of these forfeited shares back - it feels like it would be theft if not, but I’m scared!

ProSearch, a tracing agent, is legitimate and owned/part of Equiniti. It usually turns up in the story when Equiniti has lost contact with a shareholder and ProSearch will try to seek you out (and charge a fee...). I'm guessing you hadn't updated Equiniti of a change of address?

Which company? You need to look at its Articles of Association to see what it says. There might be a section called 'forfeiture' or 'untraced shareholders' e.g., Aviva's below. Unfortunately, in the right circumstances, shares can be forfeited.

So they were sold and you received a cheque for the proceeds or were they forfeited to the company? Sounds like they went to the company; I'd contact the company and ask for the money, probably starting with investor relations.

https://static.aviva.io/content/dam/aviva-corporate/documents/share-holder/pdfs/aviva-plc-articles-of-association-may-22.pdf

aspiespender1

That is very helpful. Thank you.

i must say it seems absolutely disgraceful that these things are not highlighted. Can you imagine buying any other asset and discovering that they’re entitled to sell your stuff if you don’t stay in touch?

I’ll check the clauses for mine (Next and GSK) and hope for the best!

Thank you.

aspiespender1

Desperately sad if this is the case as we need the proceeds and are somewhat dependent on them. Do you think there may be recourse in uk law? No financial advisor ever cautioned us that we lose our assets in the event they don’t contact us.
thing is - although prosearch sent an offer, we didn’t view these shares as lost nor did we want to “buy” what we already owned from a third party.
so why could equiniti not notify us of this if prosearch were able to get in touch? It seems very unethical. 

wmb194

aspiespender1 said:

Desperately sad if this is the case as we need the proceeds and are somewhat dependent on them. Do you think there may be recourse in uk law? No financial advisor ever cautioned us that we lose our assets in the event they don’t contact us.
thing is - although prosearch sent an offer, we didn’t view these shares as lost nor did we want to “buy” what we already owned from a third party.
so why could equiniti not notify us of this if prosearch were able to get in touch? It seems very unethical. 

It's the nature of buying financial securities: they have terms and conditions and it's assumed you've read them. This is a rather obscure one, though, that I doubt many people know about.

This is yet another downside of owning shares via certificates. If they'd been lodged with a stockbroker this wouldn't have been an issue.

If the companies (Next and GSK) have fulfilled their side of the terms i.e. made best efforts to find you - and it appears they did - I don't see what you can do other than contact the companies and say it's all a terrible mistake and please can you have the proceeds. It sounds like you know the details of the sales ("annoyingly the shares were sold at a very low point which seems cheeky!").

wmb194

It looks like GSK gives you two years from the sale of the forfeited shares to claim:

https://www.gsk.com/media/7539/mark-up-of-gsk-plc-aoa-adopted-3-may-2018-updated-for-4-may-2022.pdf

aspiespender1

It’s interesting because although they did track us - at no point did they notify that we risk losing our shares. Which is clearly dodgy. The relevant clause (much like your example) says they must make reasonable effort to find us BEFORE sending notice re forfeiture. Well it seems they found us, but failed to communicate what was at stake - we were only given two options - essentially buy our assets again(?!) or don’t. To break up the clause and thereby claim entitlement according to the letter is clearly disingenuous as that clause powerfully implies that the purpose of attempting to contact us is for the reason of making a reasonable attempt to notify us of intent to sell / forfeit whilst the letter from pro search is very obviously focussed on getting us to use their “optional” service.
very unethical and I really dislike injustice but I’ll keep you posted!
Thank you for your guidance. It is truly appreciated.