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Code of Federal Regulations Title 17. Commodity and Securities Exchanges § 17.240.17Ad–12 Safeguarding of funds and securities

Current as of January 02, 2025 | Updated by Findlaw Staff

(a) Any registered transfer agent that has custody or possession of any funds or securities related to its transfer agent activities shall assure that:

(1) All such securities are held in safekeeping and are handled, in light of all facts and circumstances, in a manner reasonably free from risk of theft, loss or destruction (other than by a transfer agent's certificate destruction procedures pursuant to § 240.17Ad–19);  and

(2) All such funds are protected, in light of all facts and circumstances, against misuse. In evaluating which particular safeguards and procedures must be employed, the cost of the various safeguards and procedures as well as the nature and degree of potential financial exposure are two relevant factors.

(b) For purposes of this section, the term securities shall have the same meaning as the term securities certificate as defined in § 240.17f–1(a)(6).

(Authority:  Secs. 2, 17(a), 17A(d) and 23(a) thereof, 15 U.S.C. 78b, 78q(a), 78q–1(d) and 78w(a))

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Cite this article: FindLaw.com - Code of Federal Regulations Title 17. Commodity and Securities Exchanges § 17.240.17Ad–12 Safeguarding of funds and securities - last updated January 02, 2025 | https://codes.findlaw.com/cfr/title-17-commodity-and-securities-exchanges/cfr-sect-17-240-17ad-12/

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