Dear CIGAs,

To start, here are several definitions you should familiarize yourself with:

Transfer Agent:
The record keeper employed by a public corporation to prepare and maintain records related to the accounts of their shareholders. Such information would include the name of each registered shareholder, his or her address and the number of shares owned. The agent oversees the issuance of certificates to new shareholders and the destruction of certificates that have been sold.

It does not matter if a transfer agent is owned by a bank or financial entity because it is a separately incorporated non financial entity posing no financial risk to those it accounts.

Street Name:
A term used for describing a stock that is held in the name of a brokerage firm, instead of the actual purchaser of the stock. When you buy a stock and let your brokerage firm hold the stock certificate on your behalf, the stock is said to be held in ?street name.?

Nominee name:
An official of a financial institution or some other appointed agent to whom securities or other funds are transferred by agreement with the actual owner. Nominees facilitate the collection and distribution of income from securities (when such securities are held in the name of a nominee), and facilitate the sale or purchase of securities when it may be inconvenient or impractical to obtain the necessary signature of the principal in order to conduct a transaction.

For additional definitions visit:

http://www.investordictionary.com
http://www.investopedia.com

There are three primary forms to represent share ownership:

1. Ownership via your account at a broker or bank in which the broker or bank holds all the shares for all clients in that share in what is called a street name. Street names today are a nominee name such as CEDE. The broker or bank then shows your ownership of this security in your monthly statement in your cash or margin account. Your shares will remain in the nominee account under the nominee name of the bank or broker in the form of a computer entry.
2. Ownership via paper certificate whereby an entity called a Transfer Agent has been informed by your broker of your coordinates and request for the delivery of a paper certificate. The Transfer Agent follows the instructions of your broker and sends the paper certificate with your name on it to either you directly or to your broker who most often then sends it to you. The process reduces the street name position by the amount of your position. Your ownership drops off your brokerage or bank statement. Yes it is that easy.
3. Ownership via the form of book entry on the books of the transfer agent: Instruct your bank or broker that you wish your shares to be in the form of a book entry at the transfer agent. Your broker then instructs the Transfer Agent of your request, giving them all your information. The transfer agent reduces the street name position by the amount of your holdings and puts your name in their books as a book entry. You now fall off the books and records of the bank or broker.

If you prefer method 2 or 3, all that is required is for you to instruct your broker or bank of your wishes.

If their eyes glass over in a blank stare or they say ?WHAT?? you do the following:

1. Call the company you are a shareholder of and ask the name and coordinates of their transfer agent. If they say they have none and are totally automated you are out of luck. This is rare but growing.
2. You call the transfer agent telling them of your broker?s rank ignorance. Ask them how to instruct the broker so that your needs are met. Call your ignorant broker or bank back and tell them you spoke to Mr./Ms. Whomever at the transfer agent and you wish them to inform Mr./Mrs. Whomever of your wishes.

Note:

Retirement accounts are hostages. You cannot overcome that in any of the above ways.

There is one more alternative that may help the retirement account holder, but will certainly protect the investor who is concerned over the financial health of your financial agent holding your investments.

Monty Guild wrote the following excerpt in early April of this year:

"REMINDER--HAVE YOU CHECKED THE SAFETY OF YOUR CUSTODIAN? HAVE YOU CAREFULLY READ THE LANGUAGE OF YOUR CUSTODIAN'S AGREEMENT WHICH GOVERNS THE DISPOSITION OF YOUR ASSETS IN THE CASE OF SERIOUS FINANCIAL PROBLEMS IN THE WORLD ECONOMY, OR WITH THE CUSTODIAN ITSELF?

In our opinion, all investors and all recipients of pension plans or holders of IRAs should check the financial stability of the custodians of the assets that they own. Equally important, is the legal wording of your relationship with your custodian. Have your attorney look over the wording and make sure that the custodian is segregating your assets and will audit your assets annually to make sure that they are segregated from other clients and from the assets of the firm itself.

We have spent money on attorneys who review the legal language in our custodial agreements as we believe that it is essential knowledge. We are money managers, not attorneys. Please have an attorney look over the legal language of your relationship with your custodian...what you find may surprise you."