Account Transfer from ShareBuilder to Zecco Update: The Missing Information

To me, things never went well when transferring an account. It took me two months to transfer my Roth IRA from Scottrade to Vanguard last time because of various errors at both Scottrade and Vanguard. Now the same problem is happening again with Zecco.

Yesterday, I got an alert from ShareBuilder, saying there’s an important message for me regarding my account. After logging into my ShareBuilder account, I found two messages about the account transfer process I initiated three weeks ago. The first one says:

We will review your transfer within the next 10 business days. To avoid your transfer being delayed or returned to your initiating broker, the fee must be covered in your cash balance. Transfers can take up to 30 days; partial shares cannot be transferred.

Since I already knew that only whole shares can be transferred, the first message doesn’t really have new information and everything seems to be fine. The unexpected actually came from the second email, which was sent on the same day:

Your request to transfer assets to another brokerage could not be completed because it is missing a Medallion Signature Guarantee. Please contact the initiating broker to correct the problem and resubmit the complete transfer paperwork to ShareBuilder.

Does those CSRs know what they are talking about when you ask them questions? Or they just give you whatever strikes them at that moment. On the day when I started the transfer, I called Zecco and asked specifically whether I need to get a Medallion Signature Guarantee and I was given a firm answer of NO. That, however, is not what ShareBuilder is requiring. So I had to call Zecco again this morning and this time the explanation was ShareBuilder may have changed their policy as a “tactic” to keep investors from defecting.

I wonder if I am the first one who was under the ShareBuilder’s new account transfer policy.

Now that the first attempt has failed and Zecco asked me to resubmit the account transfer form, I am thinking whether I really want to do the transfer or not. If, as ShareBuilder has stated, the partial shares will be liquidated (I own 155.658 shares), the total cost of the transfer could be as high as $65.95 ($50 transfer fee plus $15.95). This’s too much for some $200 profit. If ShareBuilder doesn’t charge fees for closing account (I didn’t find it on their website), I think it’s better to just sell all my positions and close the account instead of transferring it out.

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