E.Schwab problems Message Board

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Non-Tech : E.Schwab problems

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From: Findit	4/13/2009 11:19:23 AM
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Been with Schwab for 13 years. I average at least 1000 trades a year. So I was quite surprised to be screwed by them in the last week. I trade a lot in penny stocks. Many times they spin off restricted shares to prop up their unhappy shareholders. These spin-offs rarely come off restriction and when some do they are usually worthless to trade. These type positions are held in Schwab accounts under a code and not a symbol. They can't be traded. When they do come out of restriction they appear like any other valid position in the portfolio. Last week one of my restricted positions went through a merger and the new company shares were placed in my account with a symbol. This alerted me that they were no longer restricted. I looked at this as a gift as I felt like they were worthless like most other spin off shares. So I put in a sell order and tried to sell them at .25. By the end of the day I ended up selling them for .05 and was happy to get something for what I though was worthless. A few days later Schwab called to tell me I had sold shares I did not own. They said it was the responsibility of the company to let me know directly that the shares were restricted. Well Schwab covered the short position for me today at 3 times the amount I sold for. No matter what I say they will not take any responsibility. On top of there putting these shares, wrongly in my account, the account is an IRA account. IRA accounts cannot be shorted. Bottom line due to this screw-up, on principal, I will be moving out of Schwab to another broker over time. Moving will not be easy as I have 5 accounts with them and hundreds of positions. But I see no other way to go. To bad as I have been a big supporter of Schwab for years. Jim

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