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  1. #1
    Join Date
    Nov 2012

    Default Can You be Charged a Transfer Fee After a Stock Broker Merger

    My question involves personal finance in the State of: CA
    I have an investment account with a stock broker. The brokerage is merging / being taken over by another brokerage.
    They said they will "automatically" transfer all customer accounts to the new brokerage.
    I don't wish to be a customer of that other brokerage, and object to transferring my account. They are trying to charge $75 to transfer my assets out to a broker of my choice.
    Are they allowed to charge a fee when I object to transferring my account and become a customer of the brokerage they are merging with?
    I read FINRA rule 3260
    but I am unable to determine if this rule came into effect, or what the current regulation is.

  2. #2
    Join Date
    Oct 2006

    Default Re: Stock Broker Merger

    I have no idea whether or not they are allowed to do that. However, I can tell you that $75.00 is way less than it will cost you to fight them on the issue.

  3. #3
    Join Date
    Mar 2013

    Default Re: Stock Broker Merger

    There is no Rule 3260 in the FINRA rules:

    Here's FINRA's contact page:

    I suggest you call up and ask about the fee thing. There may be some other federal statute that applies.

    Meantime, make sure you put the broker on written notice that you do not consent to the transfer of your account.

  4. #4
    Join Date
    Sep 2010

    Default Re: Stock Broker Merger

    3260 was proposed twice (once in 2009 and once in 2015) and neither time was it adopted. However the essence of it appears elsewhere.

    I suggest you pay the $75 and then file a complaint once you are with your new broker.

    The problem here is that while the rules perhaps restrict a member from transferring to another brokerage with at least notice (what they call a "negative response letter") which much include information on how to go elsewhere. The costs must be disclosed, not that it has to be free. The operative rule is NASD 2510 and it's explained in an interpretation letter 02-57 Use of Negative Response Letters for the Bulk Transfer of Customer Accounts.

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