satyam-ADR termination

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Ron.B
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satyam-ADR termination

Post by Ron.B »

Hi Guys,

I am new to this forum but have been browsing this forum from past 5-6 months as a Guest. Great Forum!!

Coming to my issue… I bought Satyam shares (NYSE) which were later converted into ADR/ADS (don’t know the difference between ADR and ADS) after the CEO scandal. Few months ago I got a notice stating the termination of ADR on NYSE. One of the options was to cancel the ADR’s and get 2 Equity Shares of Satyam (in India) for every ADR if I have an Indian brokerage account. The procedure is like Canadian Broker has to submit the ADR for cancellation to CITI Bank Newyork and then CITI would provide the Equity Shares in India into my Indian Brokerage Account. After a lot of trouble and follow-up I was able to get this brokerage account setup as a Non-Resident (Canadian Citizen).

I contacted the Canadian Broker 10 days before the deadline date and the customer service rep emailed me that they don’t do the option I selected (i.e. cancelling the ADR’s and getting the Equity Shares) and I have no choice other than selling the ADR’s. I contacted them again the next day thinking that this time I might get the right rep who could help me but even the second time I got the same answer. Later I called CITI Bank (New York) and explained my situation (Contact Info was provided in the notice I got). The CITI official told me that Canadian Broker cannot do that and asked Canadian Broker to call CITY so that the CITI official could explain the Canadian Broker. After speaking to the CITI official I was little confident that I can get the Satyam Equity Shares in India. Then I went in person to apply and explained the Canadian Broker (by this time I had only 4 days for the deadline). After some discussion with the co-workers, the customer service rep said that they will try their level best as they have less time. So I submitted to the Broker in Canada just 4 days before the final date.

But unfortunately the Canadian Broker just submitted the ADR's for cancellation to New York (CITI bank) and did not provide the details of the account from which CITI Bank could deduct the charges related to this transaction on time( less than 50 dollars). In my letter I clearly mentioned to the Canadian Broker to deduct from my account all charges related to this transaction. Now I will be deducted 42% of the amount as taxes after the sale of these ADR's in India. I lodged a complaint to the Compliance department asking for compensation and they got back to me stating that I did not give them enough time to work on this (10 business days) and will be paying me 100$ as a client service gesture in appreciation to my business.

I came to know about the mistake (i.e. not providing the details of the account from which CITI Bank could deduct the charges related to this transaction) my Broker made when I called the CITY official on the last day around 2pm. I immidiately called the Broker and gave them this info but these guys were unable to get back to CITY before the 3pm deadline and the transaction was rejected.

Are there any chances of compensation in this situation? And whom should I approach?

Thanks everyone for your time and advice.

Regards,
Ron.B
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Re: satyam-ADR termination

Post by Ron.B »

I won the case in small claims court against the brokerage company here in Toronto. :D
I was compensated with all the money I lost i.e. taxes deducted in India(42%)+legal fees+my lost wages during trail. :D
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adrian2
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Re: satyam-ADR termination

Post by adrian2 »

Ron.B wrote:I won the case in small claims court against the brokerage company here in Toronto. :D
I was compensated with all the money I lost i.e. taxes deducted in India(42%)+legal fees+my lost wages during trail. :D
Big question is, will you get paid?
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Ron.B
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Re: satyam-ADR termination

Post by Ron.B »

adrian2 wrote:
Ron.B wrote:I won the case in small claims court against the brokerage company here in Toronto. :D
I was compensated with all the money I lost i.e. taxes deducted in India(42%)+legal fees+my lost wages during trail. :D
Big question is, will you get paid?
.

Even I was doubtful. So I am posting only after I got paid. :-)
I am posting this as it might be useful to somebody in the future.
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