“I can’t close my trading account!”
Dear Money Helps: I opened a brokerage account for my son at Success Trade Securities for a school project. He lost most of the money - and his interest in stocks. I tried, first online and then by letter, to sell the shares and close the account but heard nothing until January, when I was hit with a $50 inactivity fee. What gives? - Doug Munro, Warren, Mich.
Answer: No company likes to lose a customer, but some businesses make it harder than others to sever ties. According to Success Trade spokesman Patrick Dorton, you must sell the assets in your account before it can be closed. You should have been able to do that online, but around the time you wrote your letter, Success Trade was bought by Penson Financial Services. You couldn’t log on because the old PIN, the last four digits of your son’s Social Security number, no longer worked.
Even if it had, closing your account still would’ve been difficult. Customer service reps told you the necessary forms were on the Web site, but you couldn’t find them. When we logged on recently, we couldn’t find them either, although account withdrawal forms were on the Web sites of Success Trade’s two subsidiary brokerages, Low Trades and Just2Trade.
Even though your letter wasn’t enough to authorize a trade or closure of the account, customer service should have given you proper instructions on liquidating your assets and closing the account and told you that your PIN had changed. After we talked with Dorton, Success Trade agreed to waive the $50 inactivity fee and help you unload the shares.
The next time you run into a snafu with a brokerage, ask to speak to the firm’s compliance department, which handles customer problems. And if that doesn’t work, file a complaint with the Financial Industry Regulatory Authority (formerly the NASD), which licenses securities dealers. FINRA not only will help you get a response to the problem but, if the case is serious enough, will fine or punish the broker involved. No problem is too minor for FINRA to look into. “If we see a trend in complaints, that gives us a red flag,” says John Gannon of FINRA’s office of investor education.
Having a financial nightmare? E-mail Donna Rosato at money_helps@moneymail.com.
Reporting By Brad Nelson
Very right, the IT enabled service provider should be arranging to settle matters through interaction too , in case of need , but due to cost involved no organisation cares for it and the customers is at the receiving end for no fault of his. Presumption of flawlessness in programme and all time accessibility is wrong and there should be laws to force the organisations to put in place the interactive plateforms at all times and in all possible ways.
Actually, most firms will close your account quickly because if it’s nearly empty they do not want you to use their trading tools for basically free since you are not generating profits for them.
In response to George (Garden City), there is no company, large or small, that values anything more than making money, and they could care less if they inconvenience a few customers along the way. It’s smart business to make it hard to close an account because from their point of view they are not making money once you close it.
Whether you go with a big or small brokerage house, the service likely will not change.
As an employee of a brokerage I can attest is isn’t always as easy as you would think to close an account. I deal with it on a daily basis and unless you have a 0 balance expect it to take awhile anywhere you have your money.
Why does anyone ever bother with these shady outfits, when everyone has easy and cheap access to the services of highly respected and known brokerage names. Scottrade and Fidelity brokerage are the best around by far. especially Scottrade, you have a problem, just go down to any of their offices. the ratio of cost to the level of service and reliability of these outfits are the best in any industry not just brokerages. I keep accounts (brokerages and IRAs) at both places because i have hard time favoring one over the other.
E*Trade did the same to me. I have been trying to close and transfer. But nothing worked. They charge you $40 for issuing each stock certificate. They also charge you $25 per quarter for account maintainence fee.
Merrill lynch account was awful to close up after I took huge losses on their advice in late 90’s- I still get a statement with 15c on it.
Amazingly enough this happened to me as well with an Etrade account. I had a few thousand dollars in there to play with for buying and selling small amounts of stock. When I got bored and decided to close the account…I had to eventually email them to close it out…they cashed me out mostly but never closed the account completely. They left a few cents in there and I have been geting account statements in the mail ever since letting me know how my whopper of a few cents is doing.
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Having a financial nightmare or need an advocate to cut through bureaucratic red tape? Money magazine senior writer 
All you have to do is sell the stock yourself and request a check. After settlement date (3 business days) the check will be mailed.