Brokerage Reorganization Fee Refund
If you are like me who is doing the Dividend Growth Investing strategy, you may have noticed that this type of approach is as passive as it comes and it takes very limited amount of time of managing your investments. Now, I don’t check my brokerage account (E*Trade) as often as I used to, but I still login about 1 to 2 times per week currently.
Today though, logging into my brokerage account I noticed that I had an alert in my notifications box. Generally, I love seeing these alerts as it notifies me when the dividends have been paid to me. Unfortunately, it wasn’t a dividend, but that is okay since I have 3 of them being payed out to me tomorrow. But anyways, I checked out the alert details as it provided me further specifics on a recently completed acquisition transaction between Reynolds American (RAI) and Lorillard (LO) stocks. Long story short, I received 8 shares of RAI for my 28 shares of LO and $1,423 in cash.
Not sure why I didn’t receive a notification through the brokerage account for as I wish I could of made my vote and chosen to either receive stock for stock or stock for cash reorganization. I probably would have chosen stock for stock, but I guess that is the way the deal was made and the was no choice involved for the shareholders. Additionally, upon checking my transaction history I noticed that I got slapped with $20 reorganization fee from E*Trade. Scottrade and other brokerages charges this same exact $20 fee as well, some charge more, so I would take a look at your transaction history. The bad news is that every time stocks merge or get acquired or even when some share splits occur, your brokerage account charges this sort of reorganization fee.
Now I never even heard or even seen this type of fee before, which kind of made me puzzled since I had very little control over it. So I though it was well worth a shot to kind of experiment and investigate further on this reorganization fee. I thought, I’ll just call the brokerage to get some further information on this recent RAI and LO acquisition and nicely ask them to remove the fee. After a few minutes of hold time, I had a person on the other side of the line. Usually E*Trade representatives are quite professional, so being professional in return can do wonders. After talking to them for a few minutes, I went ahead and asked them if they would be able to waive or refund the reorganization fee since I though it was somewhat unfair of a charge. In response to my question and after a somewhat of a pause the representative agreed to credit back the $20 back into my account. Another win in my book! Don’t like fees as they eat away much of the profits. Now, I am not sure if every reorganization fee can be waived just by simply calling and asking, but I guess we will see in the future.
Give it a shot and if you succeed please let me know in comments bellow.
I researched further after publishing this post and found two other reorganization fees that I involuntarily paid dating back in 2014. I have called back E*Trade representative today (06/16/2014) and the representative unquestionably removed both of the fees. Awesome service!
Please give it a try, if you don’t ask, you will never get it.
I hope that helped you guys.
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Thank you so much for writing this. I invested my first $100 into the stock market 2 weeks ago at Etrade. It was $6.95 to purchase 75 shares. The company did a reverse split and now I only have 15 shares and of course the stock is much, much lower than the price the reverse split purchase. My investment now has a market value of $36 and then Etrade placed a $38 fee on my account for the reorganization. I called and nicely asked them if they could remove the fee and they did. I would have never called if I wouldn’t have read this so thank you!
I am very glad this article was of help for you Jessica.
I would have expected a debate or something, but glad to see it didn’t happen! To me, always worth asking! Thank’s for sharing, I’ll take good note.
Funny how it works, if you never ask, you will never get it. Plus, what is the worst thing that can happen when you ask someone nicely? Getting into a debate usually doesn’t do much good, instead selling yourself as a long term client for the brokerage works much better. Even if someone does says “no” to you just remembering that it is a simple word and will not hurt you physically nor should it mentally. Additionally, that representative may not have the authority or the knowledge and asking for a manager may help the situation. Though, for me representative worked just fine.
Let me know if it works for you.
Well worth the cost of a phone call — good job!
Definitely, by only taking a few minutes out of my day I saved $20 bucks in fees. People may not notice, but they have quite a bit of leverage with these investing brokerages, especially if you are holding substantial amount of money with them. Use it to your advantage! Lastly, I would strongly recommend the readers try it themselves with ANY reorganization fee and see what happens.
Thanks for stopping by.
why won’t you let us print this ?????
I do have content protection plugin on the website, though it shouldn’t cause any issues when printing. I just tried it on Safari and works fine. Perhaps the browser you are using is not letting you. Hope that helps.