April 10, 1996
TO: OPERATIONS MEMBERS No. 15-96
TRANSFER AGENT ADVISORY COMMITTEE No. 18-96
RE: GIFTS OF MUTUAL FUND SHARES
______________________________________________________________________________
The Institutes Transfer Agent Advisory Committee recently completed a project to
review current industry practices with respect to transferring shares to a charitable
organization. A task force of the committee worked with representatives of the planned giving
community to address their desire for a procedure which would streamline the process and
eliminate some of the delays shareholders (donors) and charitable organizations were
experiencing in effecting the transfers.
The task force developed a standardized procedure to facilitate the transfer of mutual
fund shares to educational and charitable institutions. A generic "Gift Transfer of Shares" form
(attached) was developed. The form is intended for use by any donor when transferring shares
to a charitable organization. Part 1 of the form is completed by the donor to transfer ownership
to the charitable organization. Part 2 of the form is completed by the charitable organization to
register the new shares and subsequently redeem them. Mutual fund organizations may utilize
the form to design their own organizations version of it.
The following is a summary of the procedure adopted by the Transfer Agent Advisory
committee:
To transfer shares from the donor to the charitable organization:
A letter of instruction from the donor (owner)
A signature guarantee of the donors signature
Return of any certificate shares (if applicable)
Form W-9 completed by the charitable organization to certify its tax identification number
Registration information for the new account
To redeem shares by the charitable organization:
A letter of instruction from the charitable organization
A signature guarantee (if necessary)
A corporate resolution (if necessary -- some firms may require that the resolution be certified.)
For charitable institutions receiving gifts of shares who wish to immediately liquidate
the shares, the above documentation will be sent together in a single package to the fund to
permit the redemption of shares to take place on the same day the shares are transferred.
Attached is a list of mutual fund organizations and transfer agents who have agreed to
adopt the standardized procedures reflected in the proposed Gift Transfer of Shares form.
The Gifts of Shares Task Force was chaired by Roger Rainville of Pioneering Services and the
Gifts of Shares Transfer form was developed by Wayne OMelia of T. Rowe Price Associates.
The following individuals participated in the task force:
Roger Rainville - Pioneering Services, Chair
Cynthia Jones - Colonial
Charlie Hawkins - PNC Financial Services
Wayne O Melia - T. Rowe Price Associates
Melinda Schmidt - Federated Investors
Jeff McBrearty - The Vanguard Group
Edward Falvey - Keystone
Linda Gunn - SunGard Shareholder Services
We wish to extend our appreciation to the task force on behalf of the Institute and the
Transfer Agent Advisory Committee for their time and effort on this project. We strongly
encourage all Operations Members to adopt the standardized gifts of shares procedures in their
own organizations. If you have any questions regarding this matter, please contact Justine
Phoenix at 202/326-5850.
Cynthia Jones Justine Phoenix
Colonial Investors Service Center Director - Operations/
Chair - Transfer Agent Advisory Committee Transfer Agency
Attachment