OREANDA-NEWS. August 27, 2008. The insurance company ROSNO has paid about 2 million roubles to the registrar OJSC Aktsionerny Kapital under the combined liability insurance contract in compensation for the damage inflicted by the said registrar to the issuer’s shareholders, reported the press-centre of ROSNO.

In May 2008, the registrar OJSC Aktsionerny Kapital notified ROSNO that it had received claims from the legal successors of one of the shareholders demanding reimbursement of losses inflicted in course of keeping the register of shareholders. The liability of Aktsionerny Kapital, including the liability incurred in course of keeping the register of shareholders, has been insured in ROSNO under the combined registrar’s liability insurance contract.

The subsequent investigation of the insured event has revealed that the registrar’s employees made an error when inputting an entry to the register of shareholders regarding the transfer in order of succession of the ownership title to the shares, by entering incorrect quantity (share) of the issuer’s securities transferred from the testator’s account to the account of one of the shareholder’s legal successors. This resulted in an erroneous entry in the Register of shareholders to the effect that all of the testator’s securities became registered to the name of only one legal successor.

As a consequence, the property interests of other legal successors were damaged, since they could not exercise the rights conferred to them by virtue of their securities. The amount of damage inflicted to the legal successors exceeded 2 million roubles, being the sum of the market value of inherited shares and the amount of dividends thereon not received by the legal successors as a result.

The aggrieved successors have filed a claim against the registrar and the issuer to the court of arbitration, for reimbursement of damage and compensation of lost profit. In order to provide due protection of the violated property interests of legal successors, and to avoid protracted legal proceedings that would involve the aggrieved party, issuer and registrar, the insurant, with ROSNO’s written consent, has decided to resolve this dispute. The parties to the legal proceeding have entered into a voluntary settlement, and the registrar has made payments to the shareholder’s aggrieved legal successors.

After having received the documented evidence of dispute settlement from the insurant, ROSNO has paid about 2 million roubles to the OJSC Aktsionerny Kapital in compensation for the relevant costs incurred by the insurant. This is the fourth insurance payment made under the registrars’ liability insurance contracts in ROSNO’s history. The company has been conducting combined insurance coverage of risks borne by the stock registration system (registrars and depositories) for the last 10 years, and it now has contracts with the leading Russian registrars and depositories. The insurer’s experts sit at the risk management committees set up by the NAUFOR and PARTAD.