Jul 08, 2005
• Bylined Articles
When Will the Paper Chase Ever End in Arizona?
Janet Wynn, DTCC Managing Director
This past May, Delaware joined a growing
number of states in helping to modernize
the financial services industry by
eliminating the requirement for public
companies incorporated there to issue paper stock
Physical securities, as they are known on Wall
Street, are largely a thing of the past — a vestige
of a bygone era when messengers in knickers
carried satchels of securities and checks from one
brokerage house to another to settle trades.
Issuing, storing and replacing physical securities
— which are expensive to process and easy to
steal or forge — cost investors and the financial
services industry an estimated $250 million per
The preferred alternative, of course, is
electronic book entry, which is how people
purchase mutual funds, certificates of deposit,
and U.S. Treasury notes and bonds. No one
would ever think of asking for physical shares of
a mutual fund, but some investors still are attached
to the idea of holding paper certificates when it
comes to owning equities.
Download the Congressional Testimony: When Will the Paper Chase Ever End in Arizona?