ACATS Transfer thefts from Fidelity

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
Lastrun
Posts: 1512
Joined: Wed May 03, 2017 6:46 pm

Re: ACATS Transfer thefts from Fidelity

Post by Lastrun »

grok87 wrote: Mon Jul 04, 2022 5:56 am i thought those asset transfer alert are only for when you are moving money/assets TO vanguard?
Lastrun wrote: Sun Jul 03, 2022 6:37 pm
beyou wrote: Sun Jul 03, 2022 6:31 pm
Lastrun wrote: Sun Jul 03, 2022 4:48 pm
Granted it will only allow email and not texts like some of the other alerts, but would an ACATS transfer out not trigger this?
Asset transfer alerts MAY be the relevant mitigation at Vanguard. I day MAY because it is not clear if this is for incoming or outgoing or both.
Agree, why I asked the question.
Still asking the question. You would think with the countless "I am leaving Vanguard" threads over the past year or two someone has done an ACATS out.
student
Posts: 10763
Joined: Fri Apr 03, 2015 6:58 am

Re: ACATS Transfer thefts from Fidelity

Post by student »

Lastrun wrote: Mon Jul 04, 2022 6:37 am
grok87 wrote: Mon Jul 04, 2022 5:56 am i thought those asset transfer alert are only for when you are moving money/assets TO vanguard?
Lastrun wrote: Sun Jul 03, 2022 6:37 pm
beyou wrote: Sun Jul 03, 2022 6:31 pm
Lastrun wrote: Sun Jul 03, 2022 4:48 pm
Granted it will only allow email and not texts like some of the other alerts, but would an ACATS transfer out not trigger this?
Asset transfer alerts MAY be the relevant mitigation at Vanguard. I day MAY because it is not clear if this is for incoming or outgoing or both.
Agree, why I asked the question.
Still asking the question. You would think with the countless "I am leaving Vanguard" threads over the past year or two someone has done an ACATS out.
I did transfer out but I don't remember whether there was an alert.
leviathan
Posts: 140
Joined: Tue Jul 09, 2019 3:03 pm

Re: ACATS Transfer thefts from Fidelity

Post by leviathan »

leviathan wrote: Sat Jul 02, 2022 4:07 pm Is there any brokerages notifying outgoing ACATS transfer? In my experience, none did.
I want to correct my statement after checking my records.

1) I received the following notice from IBKR.
Notice of Outbound Transfer Request
Dear Client,

We’ve received a request to transfer a portion of your account XXXX to another broker. If you initiated this request, there is nothing more for you to do as this transfer will be processed shortly. If you did not initiate this transfer request, please contact your local IBKR Client Service center immediately.

2) From VG for transfer-out, I received the trade confirmation.

3) From Fidelity for transfer-out, I did not receive any trade confirmation. But monthly statement shows the transaction.
urban
Posts: 326
Joined: Wed Apr 14, 2021 12:36 am

Re: ACATS Transfer thefts from Fidelity

Post by urban »

leviathan wrote: Mon Jul 04, 2022 9:01 am I want to correct my statement after checking my records.
...
2) From VG for transfer-out, I received the trade confirmation.
...
Was it a trade confirmation about transfer, or about selling partial shares?
leviathan
Posts: 140
Joined: Tue Jul 09, 2019 3:03 pm

Re: ACATS Transfer thefts from Fidelity

Post by leviathan »

urban wrote: Mon Jul 04, 2022 9:09 am
leviathan wrote: Mon Jul 04, 2022 9:01 am I want to correct my statement after checking my records.
...
2) From VG for transfer-out, I received the trade confirmation.
...
Was it a trade confirmation about transfer, or about selling partial shares?
It was about the partial ACATS position transfers of ETF shares from Vanguard to another broker.
User avatar
JoMoney
Posts: 16260
Joined: Tue Jul 23, 2013 5:31 am

Re: ACATS Transfer thefts from Fidelity

Post by JoMoney »

anon_investor wrote: Sun Jul 03, 2022 7:53 pm
Northern Flicker wrote: Sun Jul 03, 2022 7:49 pm That’s correct. Some organizations do a better job than others, but there unlikely is ever going to be a single linear ordering of best to worst.
We plan to have a 6 figure amount in I Bonds when we enter retirement. At least that will be safe from ACATS theft.
[*uneasy hesitant laugh*] don't read the many threads out there where people have tried to answer the question about what fraud/theft mitigation Treasury Direct has if funds stolen from account
viewtopic.php?t=225415

viewtopic.php?t=333754
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
User avatar
anon_investor
Posts: 15122
Joined: Mon Jun 03, 2019 1:43 pm

Re: ACATS Transfer thefts from Fidelity

Post by anon_investor »

JoMoney wrote: Mon Jul 04, 2022 9:26 am
anon_investor wrote: Sun Jul 03, 2022 7:53 pm
Northern Flicker wrote: Sun Jul 03, 2022 7:49 pm That’s correct. Some organizations do a better job than others, but there unlikely is ever going to be a single linear ordering of best to worst.
We plan to have a 6 figure amount in I Bonds when we enter retirement. At least that will be safe from ACATS theft.
[*uneasy hesitant laugh*] don't read the many threads out there where people have tried to answer the question about what fraud/theft mitigation Treasury Direct has if funds stolen from account
viewtopic.php?t=225415

viewtopic.php?t=333754
Well TD is now safe from bad guys adding bank accounts, since it requires a mailed in paper form with signature guarantee to do so. If bad guys have access to your TD and bank accounts, then you may have larger problems.
Dottie57
Posts: 12379
Joined: Thu May 19, 2016 5:43 pm
Location: Earth Northern Hemisphere

Re: ACATS Transfer thefts from Fidelity

Post by Dottie57 »

JoMoney wrote: Sun Jul 03, 2022 11:07 am
Luckywon wrote: Sun Jul 03, 2022 10:44 am
student wrote: Sun Jul 03, 2022 9:34 am
Luckywon wrote: Sat Jul 02, 2022 11:15 am
catnapper wrote: Sat Jul 02, 2022 11:10 am I just signed into my Fidelity and turned on "Lockdown" for all accounts. I didn't even know it was a thing until today.
Etrade has an even more robust option "no funds out". Schwab had no similar option the last time I asked, which in my opinion is one of their few weaknesses.
How do I enroll in "no funds out" option at Etrade?
Enrolling and temporarily lifting must be done on phone and they will verify identity with a text code and asking identity questions.

Unlike Fidelity's Account Lockdown, where checks, billpay debits are not blocked, Etrade's No Funds Out blocks funds going out in any form, so I think it is better.
FWIW, if you didn't want the checks, billpay, debit card, etc.. functionality on your Fidelity account you can not enable it and/or dis-enroll in it, and worth noting that you can't transfer or impact securities with those features either, only cash available for withdrawal in the account can be debited.
Ok. Good news that it does not affect securities. I guess obvious , but untold.
User avatar
tc101
Posts: 3810
Joined: Tue Feb 20, 2007 2:18 pm
Location: Atlanta - Retired in 2004 at age 54

Re: ACATS Transfer thefts from Fidelity

Post by tc101 »

I pay my gas, electric, water, and insurance through my Fidelity CMA. These bills are automatically taken out of the CMA every month. Is that a direct debit? On the info screen for the Fidelity lockdown it says direct debit is not effected. Before I lockdown I want to make sure I understand what direct debit is, and that my bills will continue to be paid.
. | The most important thing you should know about me is that I am not an expert.
User avatar
tc101
Posts: 3810
Joined: Tue Feb 20, 2007 2:18 pm
Location: Atlanta - Retired in 2004 at age 54

Re: ACATS Transfer thefts from Fidelity

Post by tc101 »

I tried to lockdown my investment account, but not my CMA. When I pushed the button to send a security code to my phone I got the following message:
Your ability to continue this activity is temporarily locked
For your security, we've locked your account after too many unsuccessful attempts. To unlock it, please call the number below and an associate will assist you.

800-343-3548
However, nothing is locked. I can log in and out of my account. I think something is broken on their web site.
. | The most important thing you should know about me is that I am not an expert.
User avatar
Elsebet
Posts: 1606
Joined: Mon Feb 08, 2016 1:28 pm
Location: Erie, PA

Re: ACATS Transfer thefts from Fidelity

Post by Elsebet »

yog wrote: Sat Jul 02, 2022 1:05 pm Sorry - I even made a typo in my TLA (three letter acronym).

MTL = Money Transfer Lockdown
https://digital.fidelity.com/ftgw/digit ... kdown/info

CMA = Cash Management Account
https://www.fidelity.com/cash-managemen ... t/overview
Thank you for posting this, I enabled MTL on all of my Fidelity accounts.
"...the man who adapts himself to his slender means and makes himself wealthy on a little sum, is the truly rich man..." ~Seneca
jimcorreia
Posts: 5
Joined: Mon Jan 24, 2022 2:48 am

Re: ACATS Transfer thefts from Fidelity

Post by jimcorreia »

Luckywon wrote: Sat Jul 02, 2022 11:15 am
catnapper wrote: Sat Jul 02, 2022 11:10 am I just signed into my Fidelity and turned on "Lockdown" for all accounts. I didn't even know it was a thing until today.
Etrade has an even more robust option "no funds out". Schwab had no similar option the last time I asked, which in my opinion is one of their few weaknesses.
Where is this setting available on E*Trade?
User avatar
whodidntante
Posts: 13114
Joined: Thu Jan 21, 2016 10:11 pm
Location: outside the echo chamber

Re: ACATS Transfer thefts from Fidelity

Post by whodidntante »

Marseille07 wrote: Sun Jul 03, 2022 5:16 pm E*Trade is not really at fault because when someone's ID is completely compromised, there's little they can do to detect fraud; every information presented to them is presumably accurate and correct.
I disagree. E*TRADE has the responsibility to know who they are dealing with, and a data breach does not remove that responsibility. They should adapt their processes or just accept that they are taking on a gigantic amount of liability.

It is absolutely possible to verify someone's identity before facilitating a comically long sequence of fraudulent transactions to occur. :P
student
Posts: 10763
Joined: Fri Apr 03, 2015 6:58 am

Re: ACATS Transfer thefts from Fidelity

Post by student »

jimcorreia wrote: Mon Jul 04, 2022 12:13 pm
Luckywon wrote: Sat Jul 02, 2022 11:15 am
catnapper wrote: Sat Jul 02, 2022 11:10 am I just signed into my Fidelity and turned on "Lockdown" for all accounts. I didn't even know it was a thing until today.
Etrade has an even more robust option "no funds out". Schwab had no similar option the last time I asked, which in my opinion is one of their few weaknesses.
Where is this setting available on E*Trade?
Luckywon replied earlier that you need to call them.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: ACATS Transfer thefts from Fidelity

Post by Marseille07 »

whodidntante wrote: Mon Jul 04, 2022 12:18 pm I disagree. E*TRADE has the responsibility to know who they are dealing with, and a data breach does not remove that responsibility. They should adapt their processes or just accept that they are taking on a gigantic amount of liability.

It is absolutely possible to verify someone's identity before facilitating a comically long sequence of fraudulent transactions to occur. :P
Yeah I corrected upthread and I didn't mean to say E*Trade carries no responsibility.

That said, brokers won't take measures to fix this because the cost of doing so would be prohibitively expensive & not much return. It's not like people flock to E*Trade because they send a notary person when you open an account.

They'll just eat the cost whenever something like this happens.
yog
Posts: 659
Joined: Wed Jan 15, 2020 11:57 am

Re: ACATS Transfer thefts from Fidelity

Post by yog »

Elsebet wrote: Mon Jul 04, 2022 11:37 am
yog wrote: Sat Jul 02, 2022 1:05 pm Sorry - I even made a typo in my TLA (three letter acronym).

MTL = Money Transfer Lockdown
https://digital.fidelity.com/ftgw/digit ... kdown/info

CMA = Cash Management Account
https://www.fidelity.com/cash-managemen ... t/overview
Thank you for posting this, I enabled MTL on all of my Fidelity accounts.
Glad this helped.

Following my chat with holiday support yesterday, I have to speak with a different tier tomorrow to run through our options. Our CMA transfers cash/margin from our taxable brokerage account on demand, and this isn't currently supported with MTL.
User avatar
vitaflo
Posts: 1905
Joined: Sat Sep 03, 2011 3:02 pm

Re: ACATS Transfer thefts from Fidelity

Post by vitaflo »

Time to create brokerage accounts at all the major firms. Hackers can't create an account as me if I already have an account. :wink:
rkhusky
Posts: 17763
Joined: Thu Aug 18, 2011 8:09 pm

Re: ACATS Transfer thefts from Fidelity

Post by rkhusky »

vitaflo wrote: Mon Jul 04, 2022 1:00 pm Time to create brokerage accounts at all the major firms. Hackers can't create an account as me if I already have an account. :wink:
They will just use minor firms. How many brokerages use ACATS?
urban
Posts: 326
Joined: Wed Apr 14, 2021 12:36 am

Re: ACATS Transfer thefts from Fidelity

Post by urban »

rkhusky wrote: Mon Jul 04, 2022 1:08 pm
vitaflo wrote: Mon Jul 04, 2022 1:00 pm Time to create brokerage accounts at all the major firms. Hackers can't create an account as me if I already have an account. :wink:
They will just use minor firms. How many brokerages use ACATS?
I think one can open another account at the same brokerage.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: ACATS Transfer thefts from Fidelity

Post by Marseille07 »

urban wrote: Mon Jul 04, 2022 1:20 pm I think one can open another account at the same brokerage.
Yeah but that won't result in ACATS as far as I understand. My understanding is that ACATS is between different brokerages.
urban
Posts: 326
Joined: Wed Apr 14, 2021 12:36 am

Re: ACATS Transfer thefts from Fidelity

Post by urban »

Marseille07 wrote: Mon Jul 04, 2022 1:25 pm
urban wrote: Mon Jul 04, 2022 1:20 pm I think one can open another account at the same brokerage.
Yeah but that won't result in ACATS as far as I understand. My understanding is that ACATS is between different brokerages.
You have to designate a landing account.
Edit: sorry I did not make it clear enough. A black hat opens another account with a victim's ID in the receiving brokerage, where the victim happen to have its own account. Then the black hat ACATS from a donor brokerage of the victim to the account he opened at the receiving brokerage. Existing of the another (victim's) account at the receiving brokerage does not prevent ACATS initiated by the black hat.
Last edited by urban on Mon Jul 04, 2022 1:47 pm, edited 1 time in total.
RetiredAL
Posts: 3537
Joined: Tue Jun 06, 2017 12:09 am
Location: SF Bay Area

Re: ACATS Transfer thefts from Fidelity

Post by RetiredAL »

whodidntante wrote: Mon Jul 04, 2022 12:18 pm
Marseille07 wrote: Sun Jul 03, 2022 5:16 pm E*Trade is not really at fault because when someone's ID is completely compromised, there's little they can do to detect fraud; every information presented to them is presumably accurate and correct.
I disagree. E*TRADE has the responsibility to know who they are dealing with, and a data breach does not remove that responsibility. They should adapt their processes or just accept that they are taking on a gigantic amount of liability.

It is absolutely possible to verify someone's identity before facilitating a comically long sequence of fraudulent transactions to occur. :P
Are you sure that is possible, short of requiring a face-to-face to present ID documents?

There is corollary evidence that PII (Personal Identification Information) may have come from a tax processor. My tax processor has my Name, Address, DOB, SS#, DL#, Phone#, and E-mail as PII, plus it has my broker name, my account numbers, and 1099 entry details -- thus based on dividends and/or withdrawals, a relative size of the account can be deduced so the thief can tell if I'm a target worth chasing after.

With that PII, (Name, DOB, SS#, DL#) I would expect the online new account validation tests at both E*Trade and BofA to "pass". Even if the new account validation process requires uploaded of a DL and SS card, or even a utility bill, those can be easily manufactured by the thief using standard computer software and uploaded. I doubt that different Email or Phone# would be considered unusual. I regularly use 2 of each, and have more than those two. I would expect a different address to raise the risk detection level somewhat, but people do move and often set up new accounts associated with the move.

Since the PII on file at E*Trade largely matches the PII at Fidelity, the rules for processing ACATS says the transfer MUST happen within a very short period of time, like business 1 day.

We do not know how long the transferred money sat at E*Trade before it went to an external account. I would hope E*Trade requires days to weeks before allowing a new account to transfer a large $ amount out. For all we know, the fraudulent E*Trade account and it's banking links had been created weeks or months ahead of the actual ACATS transfer. These thieves how to skirt around detection checks.

People today expect instant online everything. This is the risk we take for that convenience.
User avatar
anon_investor
Posts: 15122
Joined: Mon Jun 03, 2019 1:43 pm

Re: ACATS Transfer thefts from Fidelity

Post by anon_investor »

rkhusky wrote: Mon Jul 04, 2022 1:08 pm
vitaflo wrote: Mon Jul 04, 2022 1:00 pm Time to create brokerage accounts at all the major firms. Hackers can't create an account as me if I already have an account. :wink:
They will just use minor firms. How many brokerages use ACATS?
Probably all of them.
Wrench
Posts: 1055
Joined: Sun Apr 28, 2019 10:21 am

Re: ACATS Transfer thefts from Fidelity

Post by Wrench »

I wonder if there is insurance against an ACATs loss scenario described in this thread? This loss is exactly what I want insurance for - a very large loss for a very low probability event. Given how infrequent it is (or appears to be anyway) insurance should be cheap, especially since the insurance company should be able to recover all the money from one of the brokerages.

Wrench
User avatar
typical.investor
Posts: 5263
Joined: Mon Jun 11, 2018 3:17 am

Re: ACATS Transfer thefts from Fidelity

Post by typical.investor »

Wrench wrote: Mon Jul 04, 2022 2:06 pm I wonder if there is insurance against an ACATs loss scenario described in this thread? This loss is exactly what I want insurance for - a very large loss for a very low probability event. Given how infrequent it is (or appears to be anyway) insurance should be cheap, especially since the insurance company should be able to recover all the money from one of the brokerages.

Wrench
Why do you think you are not covered under the broker's guarantee against unauthorized activity?

I wonder if brokers take out insurance policies themselves to cover for say a hack other such events where they are liable under their terms.
Northern Flicker
Posts: 15363
Joined: Fri Apr 10, 2015 12:29 am

Re: ACATS Transfer thefts from Fidelity

Post by Northern Flicker »

leviathan wrote: Mon Jul 04, 2022 9:01 am
leviathan wrote: Sat Jul 02, 2022 4:07 pm Is there any brokerages notifying outgoing ACATS transfer? In my experience, none did.
I want to correct my statement after checking my records.

1) I received the following notice from IBKR.
Notice of Outbound Transfer Request
Dear Client,

We’ve received a request to transfer a portion of your account XXXX to another broker. If you initiated this request, there is nothing more for you to do as this transfer will be processed shortly. If you did not initiate this transfer request, please contact your local IBKR Client Service center immediately.

2) From VG for transfer-out, I received the trade confirmation.

3) From Fidelity for transfer-out, I did not receive any trade confirmation. But monthly statement shows the transaction.
What alerts had you set?
Northern Flicker
Posts: 15363
Joined: Fri Apr 10, 2015 12:29 am

Re: ACATS Transfer thefts from Fidelity

Post by Northern Flicker »

typical_investor wrote: I wonder if brokers take out insurance policies themselves to cover for say a hack other such events where they are liable under their terms.
My belief is that many financial institutions insure for cyberattack loss. I also think their system use policies will be aligned with requirements from the insurer when they insure against the loss. This makes it important to follow the policies. The institution is least likely to challenge your claim if they are covered, and will be motivated to push the loss through to you if they are not reimbursed, which seems like a risk if the insurer finds that the user did not follow system use policies.
leviathan
Posts: 140
Joined: Tue Jul 09, 2019 3:03 pm

Re: ACATS Transfer thefts from Fidelity

Post by leviathan »

Northern Flicker wrote: Mon Jul 04, 2022 2:26 pm
leviathan wrote: Mon Jul 04, 2022 9:01 am
leviathan wrote: Sat Jul 02, 2022 4:07 pm Is there any brokerages notifying outgoing ACATS transfer? In my experience, none did.
I want to correct my statement after checking my records.

1) I received the following notice from IBKR.
Notice of Outbound Transfer Request
Dear Client,

We’ve received a request to transfer a portion of your account XXXX to another broker. If you initiated this request, there is nothing more for you to do as this transfer will be processed shortly. If you did not initiate this transfer request, please contact your local IBKR Client Service center immediately.

2) From VG for transfer-out, I received the trade confirmation.

3) From Fidelity for transfer-out, I did not receive any trade confirmation. But monthly statement shows the transaction.
What alerts had you set?
I didn't set any alert. Just from default setting.
User avatar
retired@50
Posts: 12821
Joined: Tue Oct 01, 2019 2:36 pm
Location: Living in the U.S.A.

Re: ACATS Transfer thefts from Fidelity

Post by retired@50 »

prd1982 wrote: Sat Jul 02, 2022 2:04 pm Does anyone know if VG lets you know that an ACATS has been requested in time to stop/backout the request?
Go to Profile and Account Settings -> Alerts -> Account activity and appointment alerts.
You can choose email or text alerts.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
rkhusky
Posts: 17763
Joined: Thu Aug 18, 2011 8:09 pm

Re: ACATS Transfer thefts from Fidelity

Post by rkhusky »

urban wrote: Mon Jul 04, 2022 1:27 pm
Marseille07 wrote: Mon Jul 04, 2022 1:25 pm
urban wrote: Mon Jul 04, 2022 1:20 pm I think one can open another account at the same brokerage.
Yeah but that won't result in ACATS as far as I understand. My understanding is that ACATS is between different brokerages.
You have to designate a landing account.
Edit: sorry I did not make it clear enough. A black hat opens another account with a victim's ID in the receiving brokerage, where the victim happen to have its own account. Then the black hat ACATS from a donor brokerage of the victim to the account he opened at the receiving brokerage. Existing of the another (victim's) account at the receiving brokerage does not prevent ACATS initiated by the black hat.
I would hope that a brokerage would require that a user creating a second account for the same SSN would have to first log into their original account.
urban
Posts: 326
Joined: Wed Apr 14, 2021 12:36 am

Re: ACATS Transfer thefts from Fidelity

Post by urban »

rkhusky wrote: Mon Jul 04, 2022 2:44 pm I would hope that a brokerage would require that a user creating a second account for the same SSN would have to first log into their original account.
I guess it depends on the particular brokerage, but in VG accounts are linked to a user. For example, if in VG joint users have 2 joint accounts, and there is no concept of an original account. Every joint user logs in with his/her login/password, and can see both the same joint accounts.

Edit: I better rephrase it: in VG every user has a profile, and logs in into his/her profile. Every user can have more than one account.
User avatar
Duckie
Posts: 9777
Joined: Thu Mar 08, 2007 1:55 pm

Re: ACATS Transfer thefts from Fidelity

Post by Duckie »

leviathan wrote: Mon Jul 04, 2022 9:01 am 2) From VG for transfer-out, I received the trade confirmation.
Did you sell shares first or transfer them "in-kind"? I'm wondering if you got the trade confirmation because you sold the shares and not because the shares were pulled out via ACATS. It makes a difference.

Also, was this confirmation a text or email from an alert you had set up or was it something you noticed later when accessing your account?
leviathan
Posts: 140
Joined: Tue Jul 09, 2019 3:03 pm

Re: ACATS Transfer thefts from Fidelity

Post by leviathan »

Duckie wrote: Mon Jul 04, 2022 3:44 pm
leviathan wrote: Mon Jul 04, 2022 9:01 am 2) From VG for transfer-out, I received the trade confirmation.
Did you sell shares first or transfer them "in-kind"? I'm wondering if you got the trade confirmation because you sold the shares and not because the shares were pulled out via ACATS. It makes a difference.

Also, was this confirmation a text or email from an alert you had set up or was it something you noticed later when accessing your account?
I transferred them "in-kind. I received it from email. I didn't do any extra step to set up the alert. I think that it was enabled as a default setting when I opened the VG account.
The confirmation text:
Confirmation of transactions other than trades and Sweep Program activity is displayed below.
.... Securities transferred ...
(Notes: 1)
Notes:
1. This is a confirmation that your assets have been transferred based upon instructions received directly from you or your financial institution.
User avatar
Duckie
Posts: 9777
Joined: Thu Mar 08, 2007 1:55 pm

Re: ACATS Transfer thefts from Fidelity

Post by Duckie »

leviathan wrote: Mon Jul 04, 2022 4:11 pm The confirmation text:
Confirmation of transactions other than trades and Sweep Program activity is displayed below.
.... Securities transferred ...
This makes me feel somewhat relieved. If within 24 hours you learn that assets have been removed from your account you should be able to get them back. (Unless it's on the weekend when there is no way to contact Vanguard.)
Notes:
1. This is a confirmation that your assets have been transferred based upon instructions received directly from you or your financial institution.
Does this mean your "other" financial institution? The one that is pulling the money?

leviathan, how long did it take from the time you initiated the transfer at the new brokerage until:
  1. the assets were removed from Vanguard?
  2. the assets were available for use at the new brokerage?
Last edited by Duckie on Mon Jul 04, 2022 4:37 pm, edited 1 time in total.
User avatar
anon_investor
Posts: 15122
Joined: Mon Jun 03, 2019 1:43 pm

Re: ACATS Transfer thefts from Fidelity

Post by anon_investor »

Duckie wrote: Mon Jul 04, 2022 4:30 pm
leviathan wrote: Mon Jul 04, 2022 4:11 pm The confirmation text:
Confirmation of transactions other than trades and Sweep Program activity is displayed below.
.... Securities transferred ...
This makes me feel somewhat relieved. If within 24 hours you learn that assets have been removed from your account you should be able to get them back. (Unless it's on the weekend when there is no way to contact Vanguard.)
Notes:
1. This is a confirmation that your assets have been transferred based upon instructions received directly from you or your financial institution.
Does this mean your "other" financial institution? The one that is pulling the money?
Or if there is a holiday like today. So 3 days of being unable to reach Vanguard...
leviathan
Posts: 140
Joined: Tue Jul 09, 2019 3:03 pm

Re: ACATS Transfer thefts from Fidelity

Post by leviathan »

Duckie wrote: Mon Jul 04, 2022 4:30 pm
leviathan wrote: Mon Jul 04, 2022 4:11 pm The confirmation text:
Confirmation of transactions other than trades and Sweep Program activity is displayed below.
.... Securities transferred ...
This makes me feel somewhat relieved. If within 24 hours you learn that assets have been removed from your account you should be able to get them back. (Unless it's on the weekend when there is no way to contact Vanguard.)
Notes:
1. This is a confirmation that your assets have been transferred based upon instructions received directly from you or your financial institution.
Does this mean your "other" financial institution? The one that is pulling the money?

leviathan, how long did it take from the time you initiated the transfer at the new brokerage until:
  1. the assets were removed from Vanguard?
  2. the assets were available for use at the new brokerage?
I received an email from VG on 5/26 about confirmation of transaction at 5/25

Request Date (at IBKR) 2022-05-20
Date Available for Trading 2022-05-25
Date Available for Withdrawal 2022-06-08
User avatar
Duckie
Posts: 9777
Joined: Thu Mar 08, 2007 1:55 pm

Re: ACATS Transfer thefts from Fidelity

Post by Duckie »

leviathan wrote: Mon Jul 04, 2022 4:48 pm
Duckie wrote: Mon Jul 04, 2022 4:30 pm leviathan, how long did it take from the time you initiated the transfer at the new brokerage until:
  1. the assets were removed from Vanguard?
  2. the assets were available for use at the new brokerage?
I received an email from VG on 5/26 about confirmation of transaction at 5/25

Request Date (at IBKR) 2022-05-20
Date Available for Trading 2022-05-25
Date Available for Withdrawal 2022-06-08
Thank you.

So IBKR made it available to liquidate before Vanguard notified you it was already transferred out, but it was another two weeks before the money could be removed from the IBKR account. That means there should have been time to stop any withdrawal if necessary. But that two-week buffer might be brokerage dependent.
User avatar
whodidntante
Posts: 13114
Joined: Thu Jan 21, 2016 10:11 pm
Location: outside the echo chamber

Re: ACATS Transfer thefts from Fidelity

Post by whodidntante »

RetiredAL wrote: Mon Jul 04, 2022 1:29 pm
whodidntante wrote: Mon Jul 04, 2022 12:18 pm
Marseille07 wrote: Sun Jul 03, 2022 5:16 pm E*Trade is not really at fault because when someone's ID is completely compromised, there's little they can do to detect fraud; every information presented to them is presumably accurate and correct.
I disagree. E*TRADE has the responsibility to know who they are dealing with, and a data breach does not remove that responsibility. They should adapt their processes or just accept that they are taking on a gigantic amount of liability.

It is absolutely possible to verify someone's identity before facilitating a comically long sequence of fraudulent transactions to occur. :P
Are you sure that is possible, short of requiring a face-to-face to present ID documents?
Basically, do something other than rely on information entered on a computer.

Whatever address they tell you they live at, confirm it against ID and against public records. If all match, send a piece of mail to that address with a challenge response card. Make sure the account is restricted until the correct response is received. Fun fact: TreasuryDirect used to do something like this.

Here's another easy way if they claim to have a fancy white-collar job. Call their employer using information found online. Ask to speak to them. Ask, "hey this is whodidntante calling from E*TRADE. We reckon you opened an account recently. Does that sound about right?"

Or, if the person lives within 15 miles of an E*TRADE branch, ask them to drop in for verification and offer $50 if they do so.

Or ask them to call in to verify identity. If the person can't answer correctly, seems to need a long time to "remember" facts, or you hear typing like they are searching for the answer, leave the account restricted.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: ACATS Transfer thefts from Fidelity

Post by Marseille07 »

whodidntante wrote: Mon Jul 04, 2022 5:47 pm Basically, do something other than rely on information entered on a computer.

Whatever address they tell you they live at, confirm it against ID and against public records. If all match, send a piece of mail to that address with a challenge response card. Make sure the account is restricted until the correct response is received. Fun fact: TreasuryDirect used to do something like this.

Here's another easy way if they claim to have a fancy white-collar job. Call their employer using information found online. Ask to speak to them. Ask, "hey this is whodidntante calling from E*TRADE. We reckon you opened an account recently. Does that sound about right?"

Or, if the person lives within 15 miles of an E*TRADE branch, ask them to drop in for verification and offer $50 if they do so.

Or ask them to call in to verify identity. If the person can't answer correctly, seems to need a long time to "remember" facts, or you hear typing like they are searching for the answer, leave the account restricted.
No one would do these though. I mean sure the brokerage may be more secure, but requiring such measures would inconvenience the customers.

Besides, how many accounts are fraudulent, anyway? 0.001%?

This is one of those situations in which you can point fingers at E*Trade but they won't do anything. They'll just eat the cost of ACATS going south because that's actually cheaper than implementing measures to prevent them.
User avatar
anon_investor
Posts: 15122
Joined: Mon Jun 03, 2019 1:43 pm

Re: ACATS Transfer thefts from Fidelity

Post by anon_investor »

whodidntante wrote: Mon Jul 04, 2022 5:47 pm
RetiredAL wrote: Mon Jul 04, 2022 1:29 pm
whodidntante wrote: Mon Jul 04, 2022 12:18 pm
Marseille07 wrote: Sun Jul 03, 2022 5:16 pm E*Trade is not really at fault because when someone's ID is completely compromised, there's little they can do to detect fraud; every information presented to them is presumably accurate and correct.
I disagree. E*TRADE has the responsibility to know who they are dealing with, and a data breach does not remove that responsibility. They should adapt their processes or just accept that they are taking on a gigantic amount of liability.

It is absolutely possible to verify someone's identity before facilitating a comically long sequence of fraudulent transactions to occur. :P
Are you sure that is possible, short of requiring a face-to-face to present ID documents?
Basically, do something other than rely on information entered on a computer.

Whatever address they tell you they live at, confirm it against ID and against public records. If all match, send a piece of mail to that address with a challenge response card. Make sure the account is restricted until the correct response is received. Fun fact: TreasuryDirect used to do something like this.

Here's another easy way if they claim to have a fancy white-collar job. Call their employer using information found online. Ask to speak to them. Ask, "hey this is whodidntante calling from E*TRADE. We reckon you opened an account recently. Does that sound about right?"

Or, if the person lives within 15 miles of an E*TRADE branch, ask them to drop in for verification and offer $50 if they do so.

Or ask them to call in to verify identity. If the person can't answer correctly, seems to need a long time to "remember" facts, or you hear typing like they are searching for the answer, leave the account restricted.
Or make people do Zoom calls like ID.me?
User avatar
whodidntante
Posts: 13114
Joined: Thu Jan 21, 2016 10:11 pm
Location: outside the echo chamber

Re: ACATS Transfer thefts from Fidelity

Post by whodidntante »

Marseille07 wrote: Mon Jul 04, 2022 5:51 pm
whodidntante wrote: Mon Jul 04, 2022 5:47 pm Basically, do something other than rely on information entered on a computer.

Whatever address they tell you they live at, confirm it against ID and against public records. If all match, send a piece of mail to that address with a challenge response card. Make sure the account is restricted until the correct response is received. Fun fact: TreasuryDirect used to do something like this.

Here's another easy way if they claim to have a fancy white-collar job. Call their employer using information found online. Ask to speak to them. Ask, "hey this is whodidntante calling from E*TRADE. We reckon you opened an account recently. Does that sound about right?"

Or, if the person lives within 15 miles of an E*TRADE branch, ask them to drop in for verification and offer $50 if they do so.

Or ask them to call in to verify identity. If the person can't answer correctly, seems to need a long time to "remember" facts, or you hear typing like they are searching for the answer, leave the account restricted.
No one would do these though. I mean sure the brokerage may be more secure, but requiring such measures would inconvenience the customers.

Besides, how many accounts are fraudulent, anyway? 0.001%?

This is one of those situations in which you can point fingers at E*Trade but they won't do anything. They'll just eat the cost of ACATS going south because that's actually cheaper than implementing measures to prevent them.
You are correct, most likely. But let's not pretend that verifying identity is impossible.

But a counterpoint is that lots of people had TreasuryDirect accounts during the days that they required challenge response cards.
Yarlonkol12
Posts: 974
Joined: Thu Apr 11, 2019 4:28 pm

Re: ACATS Transfer thefts from Fidelity

Post by Yarlonkol12 »

Wrench wrote: Mon Jul 04, 2022 2:06 pm I wonder if there is insurance against an ACATs loss scenario described in this thread? This loss is exactly what I want insurance for - a very large loss for a very low probability event. Given how infrequent it is (or appears to be anyway) insurance should be cheap, especially since the insurance company should be able to recover all the money from one of the brokerages.

Wrench
What role would insurance for the consumer play here?

To me this sounds like a bank error and I would assume it would be between Fidelity and E-Trade. It sounds like it's a theft from Fidelity, the consumer may have an "incorrect balance" at the moment, but I would think Fidelity should be required to fix that
My posts are for entertainment purposes only.
Northern Flicker
Posts: 15363
Joined: Fri Apr 10, 2015 12:29 am

Re: ACATS Transfer thefts from Fidelity

Post by Northern Flicker »

Yarlonkol12 wrote: Mon Jul 04, 2022 7:38 pm
Wrench wrote: Mon Jul 04, 2022 2:06 pm I wonder if there is insurance against an ACATs loss scenario described in this thread? This loss is exactly what I want insurance for - a very large loss for a very low probability event. Given how infrequent it is (or appears to be anyway) insurance should be cheap, especially since the insurance company should be able to recover all the money from one of the brokerages.

Wrench
What role would insurance for the consumer play here?
The institution would carry the insurance, not the consumer.
rkhusky
Posts: 17763
Joined: Thu Aug 18, 2011 8:09 pm

Re: ACATS Transfer thefts from Fidelity

Post by rkhusky »

urban wrote: Mon Jul 04, 2022 3:24 pm
rkhusky wrote: Mon Jul 04, 2022 2:44 pm I would hope that a brokerage would require that a user creating a second account for the same SSN would have to first log into their original account.
I guess it depends on the particular brokerage, but in VG accounts are linked to a user. For example, if in VG joint users have 2 joint accounts, and there is no concept of an original account. Every joint user logs in with his/her login/password, and can see both the same joint accounts.

Edit: I better rephrase it: in VG every user has a profile, and logs in into his/her profile. Every user can have more than one account.
So, if someone tried to set up a new account with the same SSN as an existing user, Vanguard should flag that and tell them to log in first to their existing profile.
student
Posts: 10763
Joined: Fri Apr 03, 2015 6:58 am

Re: ACATS Transfer thefts from Fidelity

Post by student »

rkhusky wrote: Mon Jul 04, 2022 11:03 pm
urban wrote: Mon Jul 04, 2022 3:24 pm
rkhusky wrote: Mon Jul 04, 2022 2:44 pm I would hope that a brokerage would require that a user creating a second account for the same SSN would have to first log into their original account.
I guess it depends on the particular brokerage, but in VG accounts are linked to a user. For example, if in VG joint users have 2 joint accounts, and there is no concept of an original account. Every joint user logs in with his/her login/password, and can see both the same joint accounts.

Edit: I better rephrase it: in VG every user has a profile, and logs in into his/her profile. Every user can have more than one account.
So, if someone tried to set up a new account with the same SSN as an existing user, Vanguard should flag that and tell them to log in first to their existing profile.
This is the procedure at Etrade. (At least it happened to me last time.)
urban
Posts: 326
Joined: Wed Apr 14, 2021 12:36 am

Re: ACATS Transfer thefts from Fidelity

Post by urban »

student wrote: Tue Jul 05, 2022 6:45 am
rkhusky wrote: Mon Jul 04, 2022 11:03 pm So, if someone tried to set up a new account with the same SSN as an existing user, Vanguard should flag that and tell them to log in first to their existing profile.
This is the procedure at Etrade. (At least it happened to me last time.)
So, ETrade did not allow you to establish a new account at ETrade with the same SSN without you being logged in into your already existing account/profile, right?
student
Posts: 10763
Joined: Fri Apr 03, 2015 6:58 am

Re: ACATS Transfer thefts from Fidelity

Post by student »

urban wrote: Tue Jul 05, 2022 8:03 am
student wrote: Tue Jul 05, 2022 6:45 am
rkhusky wrote: Mon Jul 04, 2022 11:03 pm So, if someone tried to set up a new account with the same SSN as an existing user, Vanguard should flag that and tell them to log in first to their existing profile.
This is the procedure at Etrade. (At least it happened to me last time.)
So, ETrade did not allow you to establish a new account at ETrade with the same SSN without you being logged in into your already existing account/profile, right?
Yes. It said I already have a profile/account (don't remember the word) and asked me to logged on.
urban
Posts: 326
Joined: Wed Apr 14, 2021 12:36 am

Re: ACATS Transfer thefts from Fidelity

Post by urban »

student wrote: Tue Jul 05, 2022 8:06 am
urban wrote: Tue Jul 05, 2022 8:03 am
student wrote: Tue Jul 05, 2022 6:45 am
rkhusky wrote: Mon Jul 04, 2022 11:03 pm So, if someone tried to set up a new account with the same SSN as an existing user, Vanguard should flag that and tell them to log in first to their existing profile.
This is the procedure at Etrade. (At least it happened to me last time.)
So, ETrade did not allow you to establish a new account at ETrade with the same SSN without you being logged in into your already existing account/profile, right?
Yes. It said I already have a profile/account (don't remember the word) and asked me to logged on.
Thank you.
Wrench
Posts: 1055
Joined: Sun Apr 28, 2019 10:21 am

Re: ACATS Transfer thefts from Fidelity

Post by Wrench »

Northern Flicker wrote: Mon Jul 04, 2022 8:22 pm
Yarlonkol12 wrote: Mon Jul 04, 2022 7:38 pm
Wrench wrote: Mon Jul 04, 2022 2:06 pm I wonder if there is insurance against an ACATs loss scenario described in this thread? This loss is exactly what I want insurance for - a very large loss for a very low probability event. Given how infrequent it is (or appears to be anyway) insurance should be cheap, especially since the insurance company should be able to recover all the money from one of the brokerages.

Wrench
What role would insurance for the consumer play here?
The institution would carry the insurance, not the consumer.
I understand the institutions could and likely do hold insurance for this situation. But that does not preclude the consumer also holding insurance (presuming it was offered). It could cover unreimbursed losses and/or losses the institution refuses to cover for whatever reason. Insurance companies are good at dealing with loss claims, brokerages not so much. Also, having an insurance company on your side probably would make the recovery process less painful because presumably their legal staff would handle the negotiations. If such a product were offered, would it be worth it? Or is it even necessary? Depends on its cost, the details of the coverage, and each person's assessment of the risk and/or hassle of recovering from a potential loss from ACATs or other fraud at the brokerage. It is a moot point though, since such products seem not to exist, likely because the occurrence of this type of fraud is rare enough that demand for such a product would not make it worth it to the companies to offer.

Wrench
RetiredAL
Posts: 3537
Joined: Tue Jun 06, 2017 12:09 am
Location: SF Bay Area

Re: ACATS Transfer thefts from Fidelity

Post by RetiredAL »

This info about lockdown was posted on Redit today -- https://old.reddit.com/user/FidelityWeston
See bolded item.

[–]FidelityWeston 1 point 5 hours ago

I can definitely help with your question, u/aweigo, and we appreciate your engagement on our page.

Money Transfer Lockdown, an additional security measure Fidelity provides to its customers, may affect or disallow certain types of transactions. In order to transfer between two of your Fidelity accounts (In your example brokerage and CMA) when Money Transfer Lockdown is enabled, you will need to temporarily disable the feature prior to making the transaction. Once you have successfully made the transfer, you can enable the lockdown again by logging in into your Fidelity.com account anytime and visit "Security Center" from your "Profile" page.

Protected Transactions:

• Outbound money transfers

• Transfers between Fidelity accounts

Transfer of shares and assets to other institutions

• Individual withdrawals (previously scheduled EFT transfers from an account might still be processed)

Unaffected Transactions:

• Deposits or transfers into a Fidelity account

• Checkwriting and direct debits

• Debit/ATM transactions

• Trading

• Scheduled Required Minimum Distribution (RMD) or Personal Automatic Withdrawal plan

• BillPay

Learn more about Money Transfer Lockdown, what it does, and how to enable/disable it on Fidelity.com
Link added by RetireAl -- https://digital.fidelity.com/ftgw/digit ... kdown/info
Post Reply