In its most limited sense, a transfer agent is an agnostic third-party entity required by law to process a transfer of a company’s securities from one investor to another. Some companies are required to use a transfer agent due to the nature of their registration with the Securities and Exchange Commission. Other companies are not required to use a transfer agent but choose to because of the arms-length nature of the transfer agent service and because additional back office services may be offered by the transfer agent services provider. Still others, which are not required to use a transfer agent, process transfers themselves acting as their own transfer agent.
What is a Transfer Agent?
Having a third-party ‘transfer agent of record’ is a must for many alternative funds. Outsourced transfer agent services mean back-office efficiency and professionalism and satisfy the due diligence requirements of sophisticated and institutional investors.
What is a Transfer Agent?
Transfer Agents for Public Companies
In many cases, you can find out which transfer agent a company uses by visiting the investor relations section of the company’s website. You also can use the website of the Securities Transfer Association, a private trade organization of transfer agents.
The Definition of a Transfer Agent
A transfer agent may be a bank, a trust company, a stand-alone transfer agent provider or a team within a corporation or investment fund acting as the company’s own transfer agent. An in-house team may license a transfer agent system to increase their own efficiency without the licensor being the ‘transfer agent of record’. Many investment funds, however, employ a third-party transfer agent even if it is not required. Having a third-party ‘transfer agent of record’ satisfies the due diligence requirements of sophisticated and institutional investors.
Transfer Agents for Investment Funds
Phoenix American Financial Services - Transfer Agent Solutions
Phoenix American transfer agent services are part of a full suite of back-office support for alternative investment funds. We provide full-service fund administration, accounting, transfer agent and investor services as well as sales and marketing reporting to fund sponsors in the alternative investment industry. Since the company’s origin in 1972 as the sponsor of equipment leasing funds, Phoenix American has performed industry-leading transfer agent services and has pioneered the enhancement of the transfer agent role into full-service fund administration and back-office outsourcing.