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NASDAQ Settlement Fund; More Questions And Answers For Filing Claims
here has been plenty of attention focused on the mega Nasdaq settlement, and you can bet that there will be more as December 8, 1999 approaches. That's the deadline for postmarking all claims.
Since we answered some questions a few issues ago, more questions have surfaced. We will discuss those questions, but first, a clarification for investors receiving the so-called "Preprinted Proof of Claim" form.
The question is what documents do investors have to submit to substantiate the securities trades stated on their claim if they receive the Preprinted Proof of Claims form? The answer is that it depends. If the investor does not disagree with the listing of securities trades on the preprinted form, then no documentation is necessary. However, if the investor believes that the listing of securities trades is incomplete, and adds additional trades, then the investor must submit documentation for those additional trades. Of course, investors who submit the Basic Proof of Claim" form must document each and every trade claimed.
Second, how many trades can investors list? That depends on the kind of claim form received. Investors can add only up to 30 trades (with a buy and a sell constituting two trades, not one) to the Preprinted Proof of Claim form. If the investor wants to add more than 30 trades, then he must substitute and use the "Electronic Proof of Claim". Compare that to the scenario where the investor receives the so-called "Basic Proof of Claim" form. On that form the investor can claim only 70 trades. If the investor wishes to claim more than 70 trades, then she must submit the claim form electronically.
The third question is why are some investors are receiving multiple forms? That reflects the fact that the investors made trades in different legal capacities (such as individual, joint or IRA accounts). Under these circumstances, investors who receive more than one Preprinted Proof of Claim form must submit all of the claims forms received in order to claim for all of the trades.
As though that's not confusing enough, some investors received a second Preprinted Proof of Claim form in September, 1999. Why? The second mailing was issued because the claims administrator received new or corrected trade information from certain brokerage firms. Investors must sign, complete and submit the claim form received in September, whether or not they previously filed a Preprinted Proof of Claim form.
The fourth question is whether to send originals or copies. Be careful here. While the claims administrator requests that investors send copies of documents to substantiate a securities trade, investors must submit the original proof of claims forms.
The fifth question is what can investors do if they lose a form. First, if the investor has lost a Basic Proof of Claim form, he can obtain another one over the Internet (www.nasdaqlitigation.com), by e-mail @ nasdaqlitigation.com, by telephone (800-933-6363), or by mail (In re. NASDAQ Litigation, P.O. Box 1730, Philadelphia, PA 19105-1730). However, if the investors lost a preprinted form (or received it damaged and cannot use it), then another preprinted form is not available. The investor must obtain either the Basic Proof of Claim form or the Electronic Proof of Claim form and substitute either one of those forms for the preprinted form. To expedite the process, for $15 (deducted from the distribution to the investor, if greater than $15) the investor can purchase a computer disk containing the trade data that was stated on the preprinted claim form.
The sixth question is how to handle a claim addressed to someone who is deceased. In this event, notify the claims administrator, who will update the records to substitute the name of the legally authorized representative for the estate. The administrator then will forward a Basic Proof of Claim form to the representative, who will complete the form, sign it in his or her capacity as representative, and submitting it with proof of each trade claimed.
Much of this claims process is "as clear as mud". As always, we stand ready to amplify these answers or to answer any other questions that you, or your clients, may have.
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Sponsored by James J. Eccleston, an attorney representing stockbrokers, financial planners and
investors nationwide in arbitration, litigation and regulatory matters, and a shareholder with the law firm
Shaheen, Novoselsky, Staat, Filipowski & Eccleston
P.C.(www.snsfe-law.com). This Web site contains material
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