I recently opened up a trading account with Sharebuilder and bought some "no transaction fee" mutual funds. Well, due to a change in my main client's budget, I found myself cashing in on those funds to help pay some bills (that and with the stock market swinging back and forth the way it has been I didn't really have the stomach for it). I turned a pretty good profit and was happy with it, but when I received the final payout, it was $200 less than I expected! Apparently the "no transaction fee" did not apply to funds sold within three months of purchase. Fair enough, and I vaguely remember reading that when I bought the mutual funds and probably dismissed it, thinking I was going to be holding on to them for a very long time.
But when I went to sell the funds, it listed "no fee" and gave me a payout amount based on that day's market close. I figured since my fees for the transaction were "0" that there would be no fees assessed. Period. What's more, I had ordered the disbursement and transfer to my savings account for the full amount. It was after that request was placed that they took the $200 out ($50 per fund sold and I had sold four funds) - AND I did not receive any email or message explaining the reason for the shortfall.
Well, I was a bit miffed, so I sent the company an email (I don't like calling when I don't have to...I had already had enough drama for the day) and four days later received this response:
Message received! We posted a yellow alert message on each review order page informing you that by placing the sell order, you may be subject to the early redemption charge. This message was shown when you sold each of your American Century mutual funds. The early redemption charge is in effect for the no transaction fee mutual funds to discourage customers from short term trading these funds. (Stocks or Exchange-traded funds may be more suitable for short term trades)
Since this was your first experience trading mutual funds on our site, I am willing to work with you. I can reimburse you for half of the charges that were assessed. The credit would be $99.90. I would post the credit to your Individual account, as your Traditional IRA would have tax consequences.
If you would like me to post this cash credit to your Individual account, please respond to this email confirming that you would like for me to do so. Should you have any further questions about this issue, feel free to contact us again.
Remember what I said earlier about "fool me once shame on you, fool me twice shame on me?" Why not give the customer the benefit of the doubt - at least once, and especially with new customers.
I was ready to sell everything else (it wasn't much, but it was something and I hope to have more to add in the future like all of us) but instead Sharebuilder now has a loyal customer.
Sure, they didn't refund the entire $200 but they did something - and that's what counts.