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October 14, 2006

Zecco - Not Entirely Free Lots of "Hidden" Fees

posted by MR WAVETHEORY at 10/14/2006 12:23:00 PM
Following up on my post Zecco: Is Free A Business Model, Zecco has proven that it is not entirely free. In fact, just about everything but trading costs money at Zecco - even getting a statement. Of course, the page is hidden deep inside the site. I thought you should know before you switch. I expect Bank of America (NYSE BAC) to also charge for many services. You can see the charges for yourself.

The Other Charges really add up. Some of things that cost money but really shouldn't including maintaining an IRA account (annual fee) and also closing/transferring your account. If you have a $2500 account at Zecco and you have to pay an IRA maintaince fee of $50, that translates into 2% of your account! And that's just for starters, a copy of your statement is $15 and automated account transfer is $50.

Other Charges

144 Sales $35.00 plus regular commission
Accommodation Transfers $25.00 plus certificate fees per issue
Automated Customer Account Transfer (ACAT) $50.00 per account
Physical Stock Deposit $50.00
Prepays on Customer Trades $10.00 plus interest to settlement date
Reg. “T” Extension $10.00 per request plus interest from settlement date until paid
Reorg Items and Tenders $15.00 per request plus interest from settlement date until paid
Research & Statement Copies $15.00 per hour (1 hour minimum)
Returned Checks $20.00 plus interest from the earlier of the settlement date or date of deposit
Securities purchased against Non-Cleared Funds Interest on balance (see margin interest rates)
Taxpayer ID Penalties At Cost
Transfer Fees At Cost
Wire Funds $15.00
Foreign Wire Fee $55.00
Saturday Delivery Checks $25.00
Overnight Check Delivery (U.S.) $15.00
Overnight Check Delivery (Int’l) $25.00
Stop Payment $25.00 per check (only if check is 10 or less days old)
Overdrawn NSF Fee $35.00
Restricted Stock processing fee $35.00 + transfer agent fee to re-register and FedEx
FedEx Overnight Fee $15.00
FedEx Saturday Fee $25.00
Transfer and Ship (Certificates) $50.00 per request
IRA Annual Fee $50.00
IRA Closing Fee $50.00
By the way, the margin rates are userous:

Dollar Range Above/Below Base Rate* Margin Rate
Above $999,999 Base Rate 8
$250,000 - $999,999 + 0.75% 8.75%
$100,000 - $249,999 + 01.25% 9.25%
$ 50,000 - $ 99,999 + 1.50% 9.50%
$ 25,000 - $ 49,999 + 2.00% 10.00%
$ 0 - $ 24,999 + 2.50% 10.50%

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2 Comments:

Blogger thrunner said...

Shocking!!! Banks and Brokerages charges fees? :)
FYI: This is the current Schwab margin:
Current Margin Rates

Margin interest rates
Debit Balance Margin Rate Effective Rate
$0-$24,999,99 Base Rate + 2.00% 10.75%*
$25,000-$49,999.99 Base Rate + 1.50% 10.25%
$50,000-$99,999.99 Base Rate + 0.50% 9.25%
$100,000-$249,999.99 Base Rate + 0.375% 9.125%
$250,000-$999,999.99 Base Rate + 0.25% 9.00%
$1,000,000-$2,499,999.99 Base Rate - 0.25% 8.50%
$2,500,000+ Base Rate - 0.50% 8.25%

* Effective March 29, 2006, the rate for balances less than $10,000 was reduced by 1%.

Base Rate = 8.75%. Schwab’s base rate was last changed on 06/30/06 (subject to change without notice).

Call a Schwab Representative at 866-713-8384 to find out today's base rate and discuss your individual margin borrowing needs.

6:04 PM  
Blogger gabouy said...

rookie question, what the time unit on the margin rates, anual, or month?

thanks,
gabo

6:42 AM  

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