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November 14, 2006

Where is Charles Schwab?

posted by MR WAVETHEORY at 11/14/2006 07:47:00 AM
You may have seen ads from The Charles Schwab Corporation (NYSE SCHW) plastered everywhere about the great service there and how you can "Talk to Chuck." I almost fell for it. I've had a much different experience with Schwab. I've just bween through a horror story from hell. Schwab now qualifies as the only brokerage firm that I have dealt with that allocates IPOs to their clients and removes them from your account when you make a profit. Want to hear how that happened?

Typically, when you get shares of a hot IPO, customers are delighted. After all, the really great ones can zoom up 40-50% on the first trading day. Everyone fights for them. IPOs are typically allocated to the best clients - read "high commission generators." So, when I was allocated a healthy chunk of an IPO recently, I was delighted. The stock just kept ticking up every day. Day after day. Great!? Right?!

No. It was great that is, until a few days later, when the shares mysteriously disappeared from my account. Schwab literally "deleted" the shares from my account that were up a great deal. They deleted them like they never existed.

Why am I upset? I am upset because:

1) The shares vanished.
2) The IPO had a nice paper profit.

Talk about talking to Chuck? Where is Chuck? Asleep at the wheel? Does Chuck even exist?

My piece of advice to you Mr. Schwab: Cut back on the advertising bull****. Invest it in customer service. And find out what happened to those IPO shares.

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