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Updated Investor Bulletin: Lost and Stolen Securities

March 6, 2025

The SEC’s Office of Investor Education and Advocacy is issuing this updated Investor Bulletin to help educate investors about lost and stolen securities and the Commission’s Lost and Stolen Securities Program (“LSSP”), a database for securities certificates reported lost, stolen, missing, or counterfeit.

About Lost and Stolen Securities

When a physical securities certificate is retired, such as when a bond is redeemed or ownership of stock is transferred, the certificate is cancelled by the transfer agent. Cancellation normally involves both an accounting entry on the books of the transfer agent and an alteration of the certificate itself. After a transfer agent cancels a certificate, the Exchange Act’s record retention rules require that the transfer agent retain the certificate or an appropriate record of the certificate for not less than six years. In the past, many corporate bond issues have been called for redemption and cancelled decades before their maturities. These bond redemptions and an active stock market have generated vast amounts of cancelled securities certificates that must be processed, stored, and safeguarded.

Certificate processing of retired certificates can involve significant costs and risks, including the theft of cancelled certificates. In many cases, stolen cancelled certificates have reentered the marketplace either through sales or as collateral for loans, resulting in fraud on public investors, public companies, creditors, broker-dealers, and transfer agents. Not only do situations such as these present potential liability for the transfer agents responsible, but they consume the resources of regulatory and criminal law enforcement agencies.

The SEC’s Lost and Stolen Securities Program

Congress directed the establishment of the Lost and Stolen Securities Program (LSSP) to curtail trafficking in lost, stolen, missing, and counterfeit securities certificates. Rule 17f-1 under the Exchange Act governs LSSP operations. The LSSP consists mainly of a database for securities that have been (i) reported lost, stolen, missing, or counterfeit or (ii) cancelled. The LSSP has two essential parts: “reports” and “inquiries.” Most financial institutions (including exchanges, banks, brokers, clearing agencies, and transfer agents) are required to report to the LSSP any certificates that they discover to be lost, stolen, missing, or counterfeit. These institutions also must submit an inquiry to the LSSP regarding any securities certificate valued at more than $10,000 that comes into their possession or keeping. These financial institutions also may voluntarily report or inquire about other certificates.

The LSSP is operated on behalf of the SEC by the SEC’s designee pursuant to a contract. The SEC’s designee processes registrations for access to the LSSP, maintains the LSSP database, receives all reports and inquiries, and responds to inquiries. If an inquiry is made on a certificate that has been reported lost, stolen, missing, or counterfeit, the inquirer will receive a match or “hit.” A hit warns the inquirer that the certificate has been reported as lost, stolen, missing, or counterfeit and is not eligible for transfer.

What can investors do?

Investors holding certificates should take care in safeguarding them from theft or other loss. If your securities certificate is lost, accidentally destroyed, or stolen, you should immediately contact the transfer agent for the security and request a “stop transfer” to prevent ownership of the securities from being transferred from your name to another’s. If you are not sure how to contact the transfer agent, your broker or bank may be able to assist you with this process. The broker, bank, or transfer agent will report the certificate as missing to the LSSP. If you later find the missing certificate, you should notify whomever you contacted to place the “stop transfer” so that the lost or stolen securities report may be removed. Otherwise, you may have difficulty selling or transferring the securities.

If you are expecting a certificate through the mail and it doesn’t arrive, you should immediately contact the organization that arranged the transaction — typically your brokerage firm. While many companies choose to use registered or certified mail to deliver securities certificates to individuals, some prefer to use regular mail so as not to call attention to the potential value of the item.

You can get a new certificate to replace the missing one.  However, before issuing a new certificate, issuers usually require the following:

  • The owner must state all the facts surrounding the loss in an affidavit;
  • The owner must buy an indemnity bond to protect the issuer and the transfer agent against the possibility that the lost certificate may be presented later by an innocent purchaser. The indemnity bond usually costs approximately two or three percent of the current market value of the missing certificate; and
  • The owner must request a new certificate before an innocent purchaser acquires it.

We recommend that you keep a copy of both sides of your certificates separate from the certificates themselves. If a certificate is lost or stolen and then transferred on the books of the transfer agent to another owner, it may be impossible for you to establish that you owned it because the transfer agent may no longer have a record of your name. But if you have a copy of the certificate or a record of the certificate numbers, the transfer agent may be able to reconstruct when it was transferred and to whom.

To avoid the cost and burden of safeguarding certificates, some investors let their brokerage firm hold their securities for them in “street name.”  And increasingly, certificates for many securities are not even available, as companies may use direct registration “book entry” securities where your ownership is reflected on the books of a company, without a physical certificate. For more information on how investors can hold securities, please see our Investor Bulletin: Holding Your Securities.  

Additional Resources

Call OIEA at 1-800-732-0330, ask a question using this online form, or email us at Help@SEC.gov.

Visit Investor.gov, the SEC’s website for individual investors.

This Investor Bulletin represents the views of the staff of the Office of Investor Education and Advocacy.  It is not a rule, regulation, or statement of the Securities and Exchange Commission (“Commission”).  The Commission has neither approved nor disapproved its content.  This Investor Bulletin, like all staff guidance, has no legal force or effect: it does not alter or amend applicable law, and it creates no new or additional obligations for any person.

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