On a previous thread about IOFIX and variable prices vs NAVs,I elaborated on the fact that FARIX changed the price of their fund two months after I sold it and clawed back over $500 from me.
I filed a complaint with the SEC with the details of the dates shares etc. It took a couple of months but the SEC acknowledged my complaint and asked the fund company what happened.
Today they responded :
" U.S. Bank Global Fund Services made an accounting error in the Fulcrum Diversified Absolute Return Fund from June 9, 2022 until August 30, 2022. As a result, the net asset value of each share class of the Fund were redetermined for the period. The maximum error during the period was $0.07 per share, representing approximately 0.77% of net asset value, for each class. As a result, in accordance with Fund policy and in coordination with the Fund, shareholder purchases and sales between those dates were reprocessed.
Based on industry accepted practices, U.S. Bank Global Fund Services, as transfer agent for the Fund, initiated reprocessing of transactions on September 13, 2022 to make shareholders and the Fund whole. U.S. Bank Global Fund Services followed normal instructions to notify intermediaries, including Schwab and Fidelity, of the NAV correction issue and asked for assistance to get shareholder activity in alignment with the corrected NAVs. The intermediaries, including Schwab and Fidelity, then reprocessed the applicable transactions for their customers.
As a good faith gesture to Fulcrum and its shareholder, U.S. Bank Global Fund Services will reimburse the shareholder "
While my original question of "So What it was your mistake, why do I have to pay for it" was sorta ignored, they are making up the difference.
So it does make sense not to "just lie down and take it".
Comments
Something similar happened to me when I first began trading futures. The broker's active platform had gotten really laggy and wouldn't always update immediately when I bought/sold a position. Turned out one day I had shorted the /ES, didn't see the confirmation on the screen, shorted again, waited, waited, and then shorted again. 30m or so later, I was short nearly 6x the position I planned for -- so I immediately closed it out and began collecting evidence before howling loudly to the firm. After some brief discussion, the brokerage credited me back the (thankfully only a few hundred $$) I had lost on the position during the chaos -- but I never actively traded on the platform* again.
It's rare for a company to do that, I think ... especially nowdays.
* which ultimately got morphed into (or became?)Schwab's StreetSmart, which I daresay still gives me chills just to look at, and why I refuse to have anything to do with even as a Schwab customer.
I had a similar thing happen several years ago but for only 20 or 30 busks difference I think. Still is probably worth complaining even for $20.
Beats filling out all those class action lawsuit things. I have never gotten more than a few bucks from those
No I received no explanation from the fund company, just the statement that they changed the NAV ( 2 months later) because it was "incorrect". In an email they did not admit anything other than say they would refund e the money as a courtesy. Schwab said they were powerless and "had" to claw back the money once the fund company changed the NAV. They did not say what steps they took to confirm this was accurate or how long after the sale they would act.
I couldn't get any more details out of the SEC either.
I did ask the Schwab rep what would happen if I had closed the account; he said he didnt know but assumed Schwab would have to make up the difference itself.
The checks came from the Distributor handling the funds.