E-trade Complaint - Mismanaged an IRA Account
My husband and I are in E-Trade Nightmare Hell. We have nearly a half million dollars invested in an IRA there. Two years ago, my husband called to purchase a $100,000 CD within the IRA account, our only one with E-Trade. It took two hours, which should have been a sign. (The other sign was E-Trade taking over three weeks to open the IRA with all this money without notifying us--a common complaint, I see from these boards. Just found my desperate letters on that.) Anyway, some idiot moved the $100,000 out of the IRA money market without my husband's permission. Mind you, we weren't surrendering the IRA funds-- just wanted to transfer the hundred thou out of the money market into the CD within the tax=free IRA account.
Fast forward to last week. The IRS sent us a bill because we hadn't paid taxes on the interest on the $100,000 CD!
Turns out they moved the money from the IRA and misregistered it as a regular account. We cannot get any satisfaction from their outsourced Philippino help line, nor from the local "relationship manager" who was unbelievable rude and had a real blame the victim attitude. In four separate phone calls to four separate people, we were told they would "solve" the problem within 48 hours. It's been a week. Every phone call says something different, but one of their people said: "We can't do anything. You just have to pay the tax until the CD expires in 2010." Unbelievable. I am in the process of pulling out all the other funds and putting them at another brokerage.
We may hire a tax lawyer. E-Trade has not been able to produce anything historical that shows the money was moved out of the IRA. We have statements--new account number, true--with the IRA statements, so didn't realize until the IRS notice that this money was invested outside the IRA without permission. They are so horrible and ineffectual, we are going to get a lawyer.