Nominee Share Dealing Options - are they protected?

wylmaw

I want to invest a pretting large sum in shares later in the year (after the RBS much hyped equity crash!), currently I have a microscopic portfolio with the Share Centre, but like most on line share 'brokers' the shares are held in a nominee account. I want to know if things went Ts up and a share dealing centre went bust - do I own the shares and will I get paid out. Are they also subject to the 'your £35k is safe in our hands' banking security rule. I did email The Share Centre and ask this question but they did not reply - and that worries me.

The_Share_Centre

Simply put, shares are held in trust in Share Nominees Ltd on behalf of all of our customers (and all stockbroker nominees work in this way). What does this mean in English I hear you say? If the stockbroker were to go bust, all shares held in the nominee company are ring-fenced and so are not regarded as company assets with which to repay creditors of the insolvent stockbroker.


We can’t track your email because of your user name here and we have no outstanding queries. We endeavour to respond within three working days and the majority of queries are dealt with in two working days so we're not sure where yours ended up, sorry! Please contact us directly again if this short response doesn’t answer your post or if you have any further specific questions.

LongTermLurker

The_Share_Centre wrote: »

Simply put, shares are held in trust in Share Nominees Ltd on behalf of all of our customers (and all stockbroker nominees work in this way). What does this mean in English I hear you say? If the stockbroker were to go bust, all shares held in the nominee company are ring-fenced and so are not regarded as company assets with which to repay creditors of the insolvent stockbroker.

We can’t track your email because of your user name here and we have no outstanding queries. We endeavour to respond within three working days and the majority of queries are dealt with in two working days so we're not sure where yours ended up, sorry! Please contact us directly again if this short response doesn’t answer your post or if you have any further specific questions.

Top marks for finding this post and joining, just so you could respond to customers - I'm impressed, well done :T

paul_williamson

I am also building a portfolio with Share Centre Plc. I have understood the way that a nominee account is kept separately from the share Centre's everday business and how this should protect my money. The Share Centre have always responded quickly and been 100% helpful yet I am still paranoid? why would I use the word 'should' and not 'will'? To put it bluntly, what is to stop somebody for example, 'borrowing' the nominee account funds or doing a Madoff with them. Who is checking this. I am building up some numbers on a screen and I have a background nagging doubt whether this can be turned into real money when the time comes.