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An article by Meshack Idehen of the Saturday Punch on why stock documents get lost.
Most times, investors buy shares without share certificates to show for their investments for many years. At other times, their dividend warrants never get to them.There could also be problems of investment swaps, where the name of an investor does not tally with his addresses and vice versa. At other times, it could be outright misspelling of names.
But the registrars who handle the documentation of these stocks in terms of verifications and certification usually blame shareholders for most of their woes.Speaking in defence of their practice, some of the registrars, while admitting the genuineness of shareholders’ problems, believe that most of the issues are blown out of proportion.
An executive at Zenith Registrars in Lagos, who spoke on the condition of anonymity, attributed registrars’ apparent inefficiency in handling these documentations to the volume of work involved.She said, ”Most of the complaints and allegations by shareholders and investors concerning the issues you have raised are true to some extent.
”We are confronted with these issues almost on a daily basis. However, I must confess to you that they are not our own making. Although there are valid claims of missing or lost share certificates and other investment documentations, these are not intentional actions by registrars of quoted companies.”And when you consider the huge number of names, addresses and issues of logistics that registrars have to deal with, then the situation would be more understandable.”
She defended further, ”Sometimes, there are situations where you have as many as 800,000 shareholding issues to deal with. Certainly, you cannot rule out human or other errors that could occur with managing such a huge number.”
Arguing along the same line, the Manager, Communication and Public Information, City Registrars, a subsidiary of Wema Group, Mr. Azzez Adeosun, said that registrars were doing their best.He said, “At City Registrar, we are very concerned about our shareholders and investors. We do not toy with their shares and investments certification.”
In his opinion, misspelling of names and addresses was not peculiar to registrars alone, as these could happen in any other establishment.As far as he was concerned, ”Some of these people (shareholders) are actually part of the problems. Some of them will move or change addresses and residences without informing us about their new addresses.
”Some get married and change the names with which they are known. Locating them with their former names or addresses becomes a big problem, as there is actually no way to reach them unless they come forward.” Accordingly, he advised, ”Let all shareholders and investors carry their registrars along as far as the change of their names and residential addresses are concerned. This would make locating them easy when there is a need to do so.”
Besides the shareholders, some of the registrars also blamed courier companies that are used to deliver the documents. But a visit to one of the courier companies in Lagos, Prudent Parcels Services Limited, was an eye-opener. For instance, First Bank Nigeria Plc uses this courier company to distribute its share certificates and other documents.
The room on the second floor of No 35 Lewis Street, Lagos, where their operations are carried out, was completely disorganised. Letters and documents, including share certificates to shareholders and investors strewed the room and there was apparently no regard for the security of those documents.In the course of moving the letters from one point to another, many of them end up not being delivered at all.
In the face of these problems, Zenith Registrars advised, ”A shareholder or investor who is having a problem with his shares documentation can take several steps to put things right. ”In the case of a wrongly spelt or wrongly written names, a shareholder can through a sworn declaration or affidavit in court, affirm his nomenclature, which can be forwarded to the registrar. It is an acceptable procedure.
”In the case of missing or lost certificates, the same procedure can also be applied. However, it is also very important that the shareholder presents a valid and constant address, where he could be reached in the event that a new certificate is issued after due diligence is conducted.”
On its part, City Registrars urged shareholders ”to remain calm and seek proper channels through which the issues can be resolved. They can choose to channel their complaints through their stockbrokers, who are experts in such matters, or seek the assistance of the Security and Exchange Commission.”In cases of wrongly written names, it is wise to secure an affidavit from the court, using the name you want to appear on the certificate in the affidavit that you will present to the registrars.”
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