There are rumours circulating that suggest Gamestop is going to perform a merger with RC ventures and change their cusip number.
I’m led to believe that in the terms and conditions of T212 and from previous cusip changes to other companies, they will forcibly liquidate your positions rather than handle the change automatically and maintaining the stock ownership record (including purchase dates) in this event.
After disgracefully not allowing ‘owners’ (who paid cash for their shares) to vote in the upcoming AGM (despite competitors like E-toro finding a way), I feel this is the final straw.
Can T212 reassure me that they can handle a cusip change and give me a reason not to liquidate my positions and take my money elsewhere?
You don’t own your shares on T212 (at least on a cash account. May be different for ISA accounts).
You own an IOU into their share pool (if they even bought them in the first place rather than just pay any money owed when you sell).
It’s why the shareholder voting is such a problem (because you don’t own common stock. You own what they call ‘beneficiery stock’) and why you cannot transfer your shares to another broker and have to liquidate if you want to leave.
In practical terms how is that different to any other broker where the shares are held in a nominee account? The person who pays for the shares is still as you acknowledge the beneficial owner.
The issue about corporate actions isn’t some sort of Machiavellian plot but just that t212 (like Freetrade and other brokers) not having systems that can easily cope with a myriad of different corporate actions.
To be fair, we all signed up to 212 when this functionality wasn’t available that we are talking about.
It will likely be in development over time, but complaining about something that was never there is a bit harsh.
I agree that as UBO of the shares we purchase, we should hopefully in time have the ability to vote. Similarly the ability to regularly invest in a pie without deposit costs. There has to be some give/take as we cant receive all these services for nothing, there is a cost to develop, implement and maintain. Someone has to pick up those somewhere down the line.
T212 do not block your voting rights, they will give a proof of ownership letter if you request one, and it is up to the company to accept it or not. This has always been the case and T212 did not promise anything different.
Oh. You’re talking about CSDR the most common method of nominee stock accounts / holding in the UK. Even HL “a proper broker” does it exactly the same.
By ‘IOU’ I’m sure you mean CASS register of title that the FCA monitors.
No, this is incorrect - this is down to functionality not being built. Put simply, it’s easily possible to do with time and resources, of which I’m sure 212 is dedicating both.
T212 could probably get you a CREST account if you wanted to get around this technicality. It’s about 8k per person per year though, plus some reasonable costs on 212’s side.
Let me take a wild swing. Someone who told you to buy GME,m at any price. I guess a mod on Superstonk, also told you this is something you should be mad about?
If I purchase shares with my own money, I should have the right to a) transfer them away from T212 without liquidation and b) vote in the AGM for said company. I can do neither at present. I can do both at other brokers (so there’s your ‘practical differences’ and with the greatest respect, these are two of the most fundamental actions in investing. The ‘oh they’ve just not implemented it this rare bespoke corporate action’ argument holds little water to me.
Not my experience so far. Semantically speaking, they aren’t blocking anything. They also haven’t sent out the proxy vote information needed to vote with my shares.
What is incorrect? Our stock is beneficiary stock? Well please allow me to copy and paste a response from T212 I received just this morning into the conversation:
|(07:08:18)|Ivan Tr.: I truly understand your concern,
|(07:08:29)|Ivan Tr.: Please bear in mind that we are currently limited in terms of providing voting rights and shareholders benefits by our intermediary. The reason being is that we hold the shares on your behalf. This classifies you as a beneficiary shareholder, not a common shareholder. Voting rights are reserved for common shareholders.
Seems correct to me?
Down to functionality not being built? No excuse imo. It’s not some bizarre out there request is it? Every company you’ve invested in probably has an AGM every year.
Actually, no, the excuse they’ve been peddling up until recently was the CREST one. Sadly for them, E-toro and HL work the same way as you said and have managed it. Apparently this isn’t some hard to implement arcane technology lost to the ages. It seems really easy if someone pulls their finger out.
Your wild swing is exactly that. Way off the mark.
That response is mixing up beneficial owner with shareholder and the response isn’t strictly correct. The whole point of being a beneficial owner of shares is that you have the same rights (in theory) as if the shares were held in your name (ie as a common shareholder). The difference being that they are held in a nominee account with the nominee then holding a register of share owners.
The reason I mentioned that you only have the same rights in theory is that is only the case if the the operator of the nominee account has the functionality to allow corporate actions - in this case t212. I would rather they did but they don’t and the fact that other brokers have that functionality is irrelevant - if you don’t like it then take your business to a broker that does offer you that functionality.
More misunderstanding - you’re not subject to PFOF as T212 don’t and can’t sell PFOF (they can and do lend shares through IKBR). PFOF is widely considered to be illegal in Europe (incl the UK).
Yes, exactly. My original question. Why shouldn’t I take my money elsewhere. Sadly it seems a forum filled with T212-can-do-no-wrong evangelists wasn’t the place to ask.
No, T212 isn’t perfect by any means, and depending on personal circumstances, other brokers may be better for some. However, we need to provide valid criticism.
Not being able to vote in an AGM,
Not being able to transfer your shares away without liquidation (really scummy btw)
Not being able to stop your invest shares from being lent out