Forwarding of Securities Information and Proxy Materials
To facilitate trading, the ownership of a security is usually designated in street name to the broker-dealer, meaning that the securities are registered in the name of the broker-dealer, rather than the actual purchaser. The purchaser is known as the beneficial owner, one who has the benefits of owning a stock or fund but whose title is held for reasons of safety or convenience by the purchaser’s broker or other custodian.
Member firms that hold securities in street name are required to forward all information they receive from the issuer (such as annual reports and information statements) to the beneficial owner or the beneficial owner’s investment adviser.
Whenever an issuer delivers proxy materials to the member firm and promises to reimburse