club_cafe: Transfer of stock

iras1 on

In a message dated 3/3/2005 1:05:58 P.M. Eastern Standard Time, jed_nov_fra@bivio.com writes:

There is a small local savings and loan that is going
public.
Depositers will get first crack at the available shares.
We have a member that can purchase the shares.
We want the member to purchase the shares in her name and
have them transfered to the club when all is said and done.
Both the member and club have the same broker
Since clubs can transfer shares to members we assume we can
do the reverse?
Thanks for any input.

No. While legally you can transfer stocks into the club, it is very difficult to maintain the accounting. Bivio is not set-up to do this (nor is the other club accounting software). If the club wants to buy shares in the bank, it should do so once the shares are trading publicly.

Our Club has a member that is 16.
Will his assets in the Club hurt him in applying for
scholarship
aid?
Does anyone have the answer to this question?

Yes, it will, but no more so than having the same value in a savings account. He will have to declare the value of his partnership interest on any financial aid application as well as the income it generated.

Ira Smilovitz

Thanks again for any input?

Rip West on

Seems to be my day for disagreeing with Ira.

<<
No. While legally you can transfer stocks into the club, it is very
difficult to maintain the accounting. Bivio is not set-up to do this
(nor is the other club accounting software). If the club wants to buy
shares in the bank, it should do so once the shares are trading
publicly.
>>

Maybe, I'm getting to pragmatic in my old age, but, again, I don't think
there is a problem here. The problems with the accounting are a result
of transferring a highly appreciated stock. I don't think that's the
case here. While it's true that there could be some difference between
FMV and cost by the time the transfer is completed, I think that could
be handled by a letter from the individual to the broker stating that he
is only acting as an agent for the club and wants the shares transferred
to the club as soon as possible.

Alternatively, you could have an agreement between the club and the
member whereby the club agrees to buy the shares from the member at the
member's cost as soon as they are available.

Rip West
Saint Paul, MN

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