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Don't Let Your Broker Blackmail You! -plus- How To Avoid Letting Your Bank Bully You! -plus- Wanna Make Sure Your Credit Card Company Doesn't Turn Your Cards Off When You Travel On Vacation?
June 6, 2002
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Dear Ben: Is there a way I can get a corrected "1099-R" form from my broker without signing a "Letter of Indemnification?" They're trying to force me to sign this letter before they'll send me the corrected 1099; they've already admitted [in writing] that they committed the error. I don't have any intention of suing them, but I don't want to sign this letter. (By the way: This is my former brokerage firm.)
Donna, via e-mail
Dear Donna: Thanks to all of the litigation over the last couple of years resulting from (pick one): The Dot-com bust, the decline in the stock markets and the Enron/Arthur Andersen debacle, I'm not terribly surprised by your former broker's attempts to "paper-their-trail." But according to Christopher Bebel, a partner in the Houston-based law firm Shepherd, Smith Bebel (their area of specialty is suing brokerage firms for fraud and mismanagement): "Donna's brokerage firm has no right to condition the release of corrected documents upon the execution of a waiver of liability. Brokerage firms have an obligation to engage in "just and equitable principles of trade" as well as engage in "fair dealing with customers." Donna's brokerage firm has violated those rules, as well as maintained inaccurate books and records. I would be pleased to write a demand letter to the brokerage firm on her behalf, and I'll make certain that the SEC, NASD and Texas State Securities Board are also copied. Once a healthy dose of sunshine is exposed to this situation, the brokerage firm will cease its efforts to extract the "no liability" letter from a customer it has mistreated." Donna, if you'd like to learn more about your rights when dealing with your broker, let me suggest two on-line resources. The Securities & Exchange Commission (SEC) website has a [predictable, albeit somewhat dry] wealth of information: www.sec.gov. And you'll find even more "investor-friendly" insight-and-information on Counselor Bebel's firm website: www.sheplawonline.com.
Dear Ben: What are my rights when "Bank A" which held (and originated) my car loan was bought by "Bank B" and I was never notified? I'm trying to get my final bill from "Bank B" (as directed in my payment booklet) but was told that "Bank B doesn't send out final bills; pay us what we tell you...and by the way: Your account is now late."
- Erica, via e-mail
Dear Erica: Either you were too young, or you didn't live in Texas during the 1980s. My "main" bank that I did business with back then went through five name changes in six years due to take-overs, consolidations and the pressures created by the S&L-related crisis during this dark stretch in Texas business history. Bottom line? You have a right to be treated professionally and fairly; in order to achieve this goal you've got to quit dealing with the front-line peon that answers the 800-number you've been calling for assistance. I suggest you start at the top of the bank's "executive food chain" [also known as the management ladder] and tell the top individual you get to that I sent you, because I knew that they'd want to personally get involved and help you through this confusing situation. Be concise, have all of your notes in front of you, tell them what you want to accomplish, and then let them solve the problem. Make sure they understand that your payment/account would not have been late if they had handled it properly in the first place. Furthermore, politely-but-firmly tell them that you expect the bank to waive any late fees associated with this inconvenience and immediately release your title upon receipt of your final payment. (And let me know how it works out!)
Dose of Dover For The Week: The summer travel season's finally here and I'm going to help you avoid potential brain-damage at the hands of your credit card company. Before you travel anywhere outside of your normal "living area" (and especially if you travel to Mexico or Eastern Europe), call the toll-free number on the back of your card(s) before you leave. After successfully jumping their security questions "hoops," tell them where you'll be going and how long you plan on being away. Otherwise, they might turn your card(s) "off" if they misinterpret your unusual charge activity for fraud.
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