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Securities Industry: SEC Leadership Needed to Further Automate Securities Transfers

IMTEC-92-4 Published: Dec 11, 1991. Publicly Released: Dec 11, 1991.
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Highlights

GAO provided information on the status of U.S. efforts to reduce physical transfers of securities certificates by using computer technology to transfer ownership, focusing on: (1) actions taken by other countries to use automation to reduce physical transfers or eliminate the use of certificates; and (2) benefits attained and obstacles overcome in other countries by automating securities transfers.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
United States Securities and Exchange Commission To further strengthen the efficiency and safety of the U.S. financial market settlement processes, the Chairman, SEC, should take action to decrease market reliance on physical transfers of securities. Such action should include setting a timetable to: (1) focus U.S. Working Committee efforts on developing and implementing a strategy for further automating securities transfers; (2) address committee concerns associated with retail investors; and (3) resolve concerns about legal obstacles that currently impair the automation of securities transfers.
Closed – Implemented
SEC does not believe that having it set an implementation timetable would be prudent given the progress made in this area. SEC is relying on a securities industry task force to address the issues and develop concrete plans for making settlement reforms. SEC intends to have its Market Transactions Advisory Committee address the state laws impeding further automation of securities transfers.

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Topics

Accounting systemsBrokerage industryCompetitionData transmissionForeign governmentsInformation systemsManagement information systemsSecuritiesFinancial instrumentsSecurities industry