pen rainbow

Saturday, October 25, 2014

The Saturday Trust—Taking Stock

Dealing with foreign and domestic stocks

I really don't know a helluva lot about stocks.  My dad did.

Navigating a maze of British stock certificates


Years ago, my dad joined a monthly stock investment club and learned about the market and how to invest in it wisely.

Unfortunately, I had no idea what I was looking at last December when I turned the key to the trust safe deposit box and pulled out a stack of aged stock certificates.  I knew that they were important enough for my dad to keep them in the box with his other important papers, but I really did not understand what I was looking at.  At first glance, I thought that he'd kept them for records purposes, which turned out to be...mostly correct.

I did not realize it then, but I was looking at nearly a year's worth of financial forensic work on these certificates.  More than any other aspect of closing the trust, these stock certificates have taken the most time to resolve.

Did they have value or were they worthless pieces of paper kept for some other reason?  Was Scottish Power the same as Scottish and Southern Energy?  (Turns out, no.)  I'd never heard of these companies, and some of them were no longer in existence.

Why didn't he leave a note explaining their meaning and significance?  And, why were there so many of them?  Most of the certificates were decades old, and there was no apparent order to them.  It had been almost four years since I'd seen the contents of the safe deposit box, and I had no memory of them.  Furthermore, it would have been out-of-character for my dad to leave leftover British stocks unresolved when he had been so meticulous about consolidating all of his personal finances.  What the heck was going on?

Note to future self:  If I ever set up a bank safe deposit box, include an inventory log and a short description of everything in the  safe deposit box.



In January, I began to unravel the meaning of these documents.  I started with Wikipedia and tracked down the history of each company.  Fortunately, there is a ton of useful information online when it comes to researching the history of companies.  I still wasn't sure how many companies I was actually dealing with because as corporations merge, some are incorporated into the parent company, while others retain their  separate identities as subsidiaries.

It took me about a month to grok the fact that the name of the company on the certificate is not the same as the shareholder group.  Publicly traded companies have shareholder groups who manage all of the share transactions.  Three of the stocks were managed by the British shareholder group, Capita Registrars; one was with Equiniti UK (another British management group), and the other had no shareholder group at all.  All of its public shares had been sold, and the unclaimed monies were deposited and held in the national in Her Majesty's National Trust.  Altogether, I was dealing with five British stocks.  One way or the other, I had to resolve each one.

To complicate matters even more, I figured out that my dad still had an open bank account at Barclay's Bank in England where the dividends from two of the stocks were being deposited twice a year.  Holy crap, now I had to deal with active British stocks that were earning dividends!  More questions...Had he paid the taxes on the dividends?


By the end of January, I had email contacts, and I knew who to contact.  I got an email response from only one shareholder group with one of the stocks.  The others, not so much...

•  One shareholder group just didn't feel like responding until I sent an actual letter.

•  Another didn't respond until I sent a letter to the wrong shareholder group, who then wrote me back and told me which group to contact.

•  It took me a while to track down the national trust info, but I managed to get the ball rolling after several emails with a rep from the company who took over the original stock.

•  By the time that I got to the last stock certificate, I knew the drill.  Check shareholder websites for information about deceased shareholders.  This is a good place to start because most companies post this info, but it is not always easy to find.  Look for links to "shareholder information" or "shareholder services."  Search for "deceased shareholder" on the website.

When it comes to stock certificates, everything is communicated by post, as in the actual mail.  In other words, forget about email and correspondence by phone.  To start with, written correspondence is the only credible and acceptable method used with shareholder groups.

After you've requested and returned a Small Estates Indemnity packet to confirm your identity as the Executor of Estate, then you can register a new online account through the shareholder's "portal."  That will give you limited access to the shareholdings.  "Limited" meaning that you can manage your shareholder info, but you can't sell the shares online unless you live in the UK...which I don't.  You can also calculate the value of your holdings online.


Research the name of the stock online and find out who the correct shareholder group is.
  1. Initiate first contact with an email.  If there is no contact link, find an address on their website under "About" or "Contact Shareholder Services," and write them a short introductory letter, including the certificate number, the name of the deceased and the issue date.
  2. Don't jump the gun on calculating the value of the shares.  You'll probably be disappointed.  You won't know exactly how many shares are valid until you complete the Small Estates process with the shareholder group.  The shareholder group will authenticate your EOE status as Executor of Estate and confirm the number and value of the certificates. 
  3. Manage only one or two stocks at a time.  It can get confusing to keep track of more than a couple of shareholder groups at a time.   
  4. Do not procrastinate!  Foreign stocks take much longer to administer because of the turn-around response time.


Never send US currency checks to UK shareholder groups.  The good news is that US banks (like Wells Fargo) can issue bank drafts in foreign currency.  The not-so-good news is that there is usually a hefty fee of $30 when they do the conversion and a $5 fee if you want to deposit it back into an American account.

Also, I found out that there is a big difference between a lowercase "p" (pence) and an uppercase "P" (pounds).  If there is a "p" next to the price per share on your certificate, and you've got 50 shares, you have to do a currency conversion from pence to pounds, then from pounds to dollars.  Don't assume that little "p" is pounds sterling.


After you've submitted a Small Estates packet with the shareholder group (this costs around £80, or around $136 USD depending on the exchange rate + a $30 bank draft fee), the shareholder group will confirm the number of shares and their value per share.  You can then decide if the value is worth pursuing any further.  Factor in the cost of postage and other processing fees, as well as the time that you have left to close the trust.  The expenses add up quickly, and you may find that the cost of pursuing a new stock certificate exceeds its value.

When this happens, it is not uncommon for individual shareholders to donate shares.  Search for a link to a donation site on the shareholder website.  Share Gift is one example, and it's a great way to bring things to a close when it comes to closing up a stock issue.


My Experience
Four out of the five mysterious British stock certificates turned out to be of little or no value.  They had been sold, paid out, or reduced to so few shares that they were not worth pursuing.  I managed to get one of the stocks transferred into my name, a new certificate was issued, and the next step was to sell the shares.

This is a job for a knowledgable foreign stock trading broker with an American brokerage firm that can sell the shares.  Fidelity and Schwab can both sell foreign stock.  Look for a link to the foreign stock trading team on the brokerage firm's website.  It's easier just to give a broker the low-down over the phone, so don't be afraid to call and ask about selling a foreign stock.

Once you get past that hurdle, the stock certificate may need to be given a CUSIP.  What's a CUSIP, you ask?  If you want to trade securities in the US or Canada, the certificate will need a 9-character alphanumeric code that identifies it as a legitimate financial security.  This can be done at your local brokerage branch, and it takes 1-3 days to process.  A broker at the branch will tell you if your certificate needs a CUSIP.  Chances are, it will if it's traded solely on a foreign stock exchange.

Then, you'll need to submit the necessary forms and the original stock certificate to the brokerage branch.  To make sure that you have the proper forms, ask the foreign trading broker to help you download the paperwork.  You'll need a stock transfer form, a CREST transfer form, and a Certificate of Release Request.  Fill them out as directed by the foreign stock trading broker.  Then, give the forms and the stock certificate to your local branch broker.

The stock will show up as a "Type 4 Asset" in your brokerage account.  This means that it cannot be traded until you get a green light from the brokerage firm after they've done their research to confirm that the shares can be sold.  This can take 15 to 20 days...or less.

Beyond this, I can't tell you if I was able to sell my British shareholdings.  

I'm waiting for Fidelity to tell me that it's okay to go ahead.  Then, I think that I'll need to submit a Letter of Instruction to the nice folks at my local Fidelity branch, then they can sell the shares.  Technically, I'm not sure if I sell them or if they sell them, but their fee is $7.50 for the transaction.

Wish me luck!!

(P.S.  The taxes on the stock dividends were paid.  Thank you, Dad!)

Saturday, October 18, 2014

The Saturday Trust—The Human Factor

Navigating the human obstacles 

Dealing with the human side of administering a trust

 Of the crooked timber of humanity, no straight thing can be made.  ~Immunuel Kant

325 days into my dad's trust, I am a certified expert on getting things done...Really, I have actual certificates that show the timeline of work that I've done since my dad passed away last November.  A handful of notarized documents gave me the authority to administer the unfinished business of his life—all of it, down to the last one thousandth of a cent.  When I signed a contract to serve as Successor Trustee the week after he died, I became a project manager.  Since then I have spent every day untangling the network of details that defined his everyday activities.

Hell is other people.  ~ Jean-Paul Satre 

Trustworthiness is at the core of this job, and it is the molten center from which the trust evolves.  I refer to it as the molten center because there is nothing easy about creating a trust or carrying out its administration after the original trustee dies.  A trust begins with the belief that the chosen successor has what it takes to navigate the rocky terrain of bureaucratic chasms and the pyroclastic flow of human drama.  

Next in line are the beneficiaries and the trust attorney each of whom has the authority to hold the successor trustee accountable for every administrative decision he or she makes.  It's part of a necessary system of checks and balances that keep the successor on track.

After that, there are the bank representatives; step-relatives; friends of the deceased; accountants; neighbors; lawyers for the people who threaten to sue the trust; contractors; cops; billing representatives who are always having a bad day; city employees; shareholder's administrators who may be located overseas; greedy insurance agents; bastardic Internet providers; DMV employees; the nameless, no bullshit IRS; county employees and postal workers.  None of these people knew me, and they certainly did not trust me.

Alright everyone, gird your loins!  ~Nigel from The Devil Wears Prada
(Funny blooper reel)

So, how do you navigate the human obstacles?  Here are some tips from nearly a year of working on a trust.

Never get on the phone when you're tired.  Don't make calls and don't answer the phone unless you feel positive and energized.  The person on the other end of the line is not your friend, and they are there to do their job.  Be patient and have exit strategies available when frustration sets in, and you need to get off the phone.

"I'm sorry, I need to check my files and get back to you."  Or, "Excuse me, but I am brain dead from working on this all day.  I'll need to follow up with you tomorrow."  When you feel the life draining out of you, get off the phone.

A good night's sleep is extremely important.  Allow for regular meal times and down time at night to unwind.

Exercise.  Watch a ball game.  Take an online tutorial in something you enjoy.  Allow time for fun activities that take your mind off of trust issues.  Force yourself to detach at least a couple of times a week.

Chances are, everyone you speak with is sitting at a desk in a room full of cubicles.  They are not going to be at their best, so be prepared with all of the important info you'll need to simplify their task.

•  Use Post-It notes on your desktop as quick references to account numbers, social security numbers, phone numbers and frequent passwords.  This is a big-time security risk, so do what you have to do to lock it down and keep this information safe from prying eyes.  My home office has a keyed lock.

•  Think about the information that agents and reps will need before you initiate contact.  Have the file in front of you with all of the basic information written on the front of the file.

•  Anticipate the questions they may ask.  Think about the course of the dialogue, from beginning to end.  Say, for instance that you want to check the status of your insurance claim.  You will need the policy number, along with the name of the last agent you spoke with and the date of your last contact.  You may be asked for the deceased's Social Security number and his/ her home telephone number.  Have your file in front of you every time you speak with a representative.  Paper clip and tab the most important documents so that the information is readily available.

•  Keep it short.  Clear and precise language is vital whenever you communicate, either in writing or on the phone.  No one wants to hear your story.  They only want the information they need to quickly answer your question.

•  Know when to cut them off.  If you feel that you are being led down a rat hole, and the know-it-all rep on the other end of the conversation is digging into facts that are none of his/her business, shut it down.  End the conversation politely, but abruptly.

"You know, I don't have all of my facts in front of me.  I'll call you back when I am more organized."  Or, "I have to look into this further so that I have a better understanding.  I will follow up with you later this week."  Or, one of my favorites, "I have a call scheduled with our trust attorney.  I will have to get back to you."  Another favorite, "Oh, I'm sorry! I have someone at my door.  I'll have to call you back.  Buh-bye."  Click.  Don't pick up the phone when they call you back 5 minutes later.

Good organization provides an effective defense whenever you are talking to account reps.

•  Organize statements in chronological order from the most recent on top to the oldest in the back of the folder.

•  Jot down notes and date everything.  If you are engaged in an all-day pursuit in which every hour counts (dealing with time zone differences, for example), also note the time of day for each contact.  Keep a log inside of every file so that you can quickly refer to the last conversation and the last person you spoke with.  Write on the inside and back flaps of the folders.  Always get the first and last name of a representative and his or her title so that you can bring the next rep, who has no idea what you are talking about, up to speed quickly and accurately.

•  Use colored folders, files & tabs.  My files are set up as follows:  Red for taxes; yellow for health-related; blue for financial /brokerage; orange for stocks; green for trust bank account; multi for household accounts; pink for administrative expenses; and gray for organizational business (e.g. Veterans Admin, funeral home, real estate, etc.).  

•  Use good phone etiquette.

•  Know how to write a good business letter, especially when you are dealing with overseas accounts.  Check for spelling, grammar and punctuation before you send out a letter.  Make sure that your letter is accurate and contains references to previous correspondence (e.g. reference numbers, account numbers, name of the deceased).  Always sign off as "SUCTR" or Successor Trustee.  Conservative investment orgs, insurance companies, and foreign accounts may not acknowledge the authority of a trust, so you'll need to sign as Executor of Estate (EOE) which works just as well to establish your identity.  Every trust contains a pour-over will which names the executor.  

•  Having said that, don't be afraid to show your fangs, if necessary.  If a rep is trying to intimidate or bully you, use your authority as Successor Trustee and Executor of Estate to stand up to him or her.  It doesn't hurt to remind a playground bully that you are The Daughter of the 5th House, Holder of the Sacred Chalice, whatever.  Just know what you are talking about and stop the interruptions and condescension. If that doesn't work, try "I give up," and hang up.  Worked for me with a rep from Lincoln County.

Don't expect friends and relatives to always understand or be willing to listen to what you are talking about when you feel the need to unburden.   Resist the temptation to share everything.  Just get the job done.

Too much transparency is a bad thing because it can contribute to confusion, self-doubt, stress and group think.  Consult with one or two close individuals, then make your decisions confidently, and be prepared to justify your reasons.

Keep in mind that the trust attorney is not your new best friend.  Cc the trust attorney only on matters that have a direct legal bearing on administering the trust.  I had to get ours involved when my dad's life insurance company refused to acknowledge the legal authority of the trust.  We had to go to court to obtain an Order to Prove Will Without Administration.  This was filed by our trust attorney's office, and I had to fax over the application paperwork.

If you are a successor trustee, ask for a copy of the trust including the Last Will & Testament before the trustee passes away.  If you are a trustee, let the successor trustee know where he or she can find the complete document if you don't feel comfortable releasing a copy before you go to the Big Cloud in the sky.

[truhst]  noun.  1.  Reliance on the integrity, strength, ability, surety, etc., of a person or thing  2.  Charge, custody or care  3.  A person on whom or a thing on which one relies  4.  The obligation or responsibility imposed on a person in whom confidence or authority is placed.

Remember that the authority to act on behalf of the trust grew out of a confident expectation that you could handle the job.