SelfWealth USA Updated Documents and Its Very Anti-Investor

They are requiring agreements to updared documents which are very hostile. Why would anyone go with selfwealth usa today with these major points:

  • You waive right to physical /direct ownership of shares.

  • Can't vote but they can vote because the shares are in their name.

  • The custodian going tits up and losing your shares or FX? That is not selfwealths problem.

  • Get any rights or share purchase plan or similar? They'll automatically sell or decline on your behalf. In fact, they'll charge you for doing this.

I feel like they're worried about meme stocks, so they're trying to wash themselves everywhere of it. Does anyone have a broker that's better than this crap?

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Comments

  • I am not well versed in the intricacies of US-owned shares in Aus, but is this different to the conditions of using Phillip Capital as the custodian previously?

    • Possibly. I can't find the old document any more.

  • +1

    Just go with Interactive brokers, much less fx fees and brokerage cost

    • Ok, but does IB have a custodian and similar terms like SW:PhilipC too?

      • Do let us know if you find non-custodian broker for US shares.

  • -2

    Echo's of OpusPrime that went belly up here several years ago. People never realised the shares they "owned" were not actually in their name, rather Opus.
    When ANZ pulled the plug on the broker and liquidated the company and all stock people (including many retirees) lost everything

  • +4

    I am in a slightly different circumstance to you (as a dual US-Australian citizen), but some things you should consider when looking for a broker managing US stocks include:

    1. The way shares are owned by American retail investors is very different to how Australian retail investors own shares: most US investors hold them as beneficiary holdings through their broker, they do not hold them directly. So your first dot point is not that unusual.

    2. Your second and fourth ones are though: As the beneficial holder you should have all the rights and responsibilities of ownership. What exactly do you buy when you buy shares through Self Wealth?

    3. Whoever you choose, you should make sure that they are a SIPC member. SelfWelath could be relying on SIPC in the event the custodian goes belly up. Then again, they may just be being dodgy: https://www.sipc.org/

    • Yes, I understand the custodian setup with beneficial ownership, but the updated document was basically, you don't own anything about the shares except when selling or getting a dividend. Anything they do for you or have to do, they'll charge you for it or they won't bother. I guess we need to be grateful for it!

      The documents don't appear to mention SIPC either.

      • +1

        I see and I agree with you completely that the arrangements are hardly investor friendly. I do note that Phillips Capital is itself a SIPC member, so you would likely have recourse if they bit the bullet. I guess Self Wealth as just saying "not my problem" here?

        On the voting, Phillips also holds the voting rights. Does that matter to you? It might, especially considering it is a Singaporean company. I can only guess that this simplifies the back-end considerably. To vote through beneficial holdings requires your broker to pass through the right and that seems pretty complicated (but doable).

        Any case, I wish I could recommend a more customer friendly broker….

  • Where is this news from? I can’t seem to see an email or any news of this change on their website or blog. I’m not signed up to their US trading so maybe that’s why.

    • +1

      I got this upon logging in this morning:

      "Please read and accept our latest Terms and Conditions to proceed to your account, and It is recommended that you download and save these documents so that you have a copy of what you have agreed to.

      Phillip Capital terms and conditions and financial services guide
      SelfWealth Privacy Policy
      SelfWealth's Financial Services Guide
      SelfWealth's Terms and Conditions
      (Check) I accept all updated Terms and Conditions

      Agree (button)"

      And yes, you can't get past this screen. They're holding your portfolio access hostage until you agree.

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