My USA Fidelity Brokerage Account

[RickNew]

I've now been in Thailand for 14 months. I just received a phone call from my Fidelity Brokerage Advisor telling me they can no longer manage my portfolio and further more I could not make any stock purchases because I no longer live in the United States.

I explained that I am only visiting Thailand, I do not work here, i do not pay taxes here, I do not own property here.

I further explained that I own property in California, I pay state income tax in California and I pay federal income tax from my California address.

The Fidelity advisor said, "my hands are tied, these are SEC rules"

Has anyone else encounter this problem? What should I do?

Thanks!!

[Jingthing]

They make a big deal on their web page if logging on outside the USA that they can't service non-U.S. residents anymore.

Some questions.

Is this an IRA?

What can you do?

Well you can try to be virtual faux U.S. resident online, address, and by phone (but likely too late as you already spilled the beans) or you can close the account and look into a place like SCHWAB.

Edited February 12, 2015 by Jingthing

[sfokevin]

I've lived here for 5 years... And even contacted them directly to get my Fidelity account linked to BKK Bank for EFT transfers... No problem...

[Jingthing]

I've lived here for 5 years... And even contacted them directly to get my Fidelity account linked to BKK Bank for EFT transfers... No problem...

There obviously is a problem.

Please say what type of account, IRA or not, are you using a U.S. residence address on it, etc.

Also BKK ACH is a domestic transfer.

Edited February 12, 2015 by Jingthing

[RickNew]

My accounts are both IRA and Brokerage. I use my USA address on the accounts.

[Jingthing]

My accounts are both IRA and Brokerage. I use my USA address on the accounts.

How did the issue come up of them knowing you live in Thailand? Your IP addresses on logging on? Do you have a U.S. phone number to speak to them with?

[RickNew]

The issue came up because last week I had a portfolio review. During the review I told the advisor I've been in Thailand for the last 14 months.

But I also told him I have a home in the USA and I pay state and federal taxes in the USA.

[Jingthing]

The issue came up because last week I had a portfolio review. During the review I told the advisor I've been in Thailand for the last 14 months. But I also told him I have a home in the USA and I pay state and federal taxes in the USA.

Like I said, you spilled the beans. You claimed residence in Thailand. Yes this is their policy now.

[Chwooly]

This is not a new SEC Policy, I ran into the same problem in 2007 with Scott Trade. If you live outside the US the law doesn't allow you to trade. You have to either lie and find a way to spoof your IP address. And of course use a US mailing address.

[Jingthing]

There is definitely more aggressive enforcement in recent years. New policy or not, that's irrelevant. Others beware and take proactive actions. I'm afraid honesty will be a problem. I noticed there are also some higher level security measures for some selected transactions like getting a text on a U.S. mobile. That could be a problem even for people who have played the game. That would be a way to smoke people out. Some might think they are OK and then when they need a level of transaction requiring higher level security, hit the wall. Sorry I don't like it ... just being real.

Edited February 12, 2015 by Jingthing

[ExpatJ]

We have a fidelity account in USA. Using our USA address. Our account - Roth ira- works no problem and they know we reside in Thailand. In fact was just on phone with them last week. No problems here.

I suspect your account was flagged for some other reason.

Edited February 12, 2015 by ExpatJ

[RickNew]

My account was only "flagged" because last week in a portfolio review I mentioned I've been in Thailand for 14 months.

[longball53098]

I encountered a similar problem more than 5 or 6 years ago. The advisor said he could not talk to me or give advice because i was out of the country. He asked me a few questions about my status and i explained i was retired military. He asked if i had access to any military facilities such as internet or phone lines. When I said I did he said if you can call or contact Fidelity using that line they could help me. I suggested if i hung up and called back and used a Skype call to their help line and when asked where I am i would say at xyz military site they would help me he implied yes that will be enough

I have a Fidelity IRA account for more than 10 years now and only contact reps when absolutely necessary and make IRA trades on line 2 or 3 times a year

[RickNew]

Thanks Longball!

[ExpatJ]

My account was only "flagged" because last week in a portfolio review I mentioned I've been in Thailand for 14 months.

I didn't mean it in a sinister way. Just that if I can use fidelity in thailand and you can't it must be another issue?

[RickNew]

Mai Pen Rai ExpatJ!! Thanks for your help!

[maewang99]

Charles Schwab sends all of my account statements and tax documents directly to my Thai address. They definitely know I am in Thailand. Not only that, but I have been trading SET and PSE counters for more than 10 years as well. I just called them two nights ago.

I use IRA accounts, Roth and old law.

I have all the same services I ever had with Schwab in the USA, and I have been with them since the 1980's as my US stock broker.... and since 2005 as to SET and PSE counters (NVDR shares as to Thailand). I receive the dividends in my IRA to the last satang after Thai W/H etc etc. But I have to wait until nighttime to call them for trades.

The only issue is that because Charles Schwab is a US broker, they must use a Thai intermediary to make the trades and they are allowed, and they do as practice, register the securities in the name of a nominee. As such you do not have those orange mailers from the TSD which we can get tax refunds with because we live here.

Believe me, the fact that I have had and still have full service from Charles Schwab is the most important financial factor in my life here in Thailand. For SET and PSE trades you do not do that from "international services" but by asking for "global trading".

Maybe the problem is that you still have a home in California! I sold mine before I left for Thailand. Torrance CA.

And given that my defined benefit pensions as well as US Social Security are dollar based, I have never lost any sleep over any recovery or further recovery in the Thai Baht.... although it is unlikely to extend much further at this stage... given the demographics, in many aspects, as well as the politics. So I'm long the PSE, not so much Thailand anymore in general.

Keep it a secret I'm in Thailand?

They have dozen of letters from here of my complaints that the shares are not registered in my name so I can get the orange mailings.

They need to put airmail postage on my account statements.

My Thai phone number shows on their displays when I make trades.

They even know to get it all done while I am on the line and not to call me back because of where I am calling from.

Enough said.

Edited February 12, 2015 by maewang99

[RickNew]

Thank you so much Maewang99 for the excellent information. If Fidelity can not straighten this out, I will contact Schwab and look into transferring my account.

My other alternative would be to fly home and walk into my Fidelity Branch and say "Hi, look, I live here!" but what a pain in the ass that would be!!

[CaptHaddock]

The issue came up because last week I had a portfolio review. During the review I told the advisor I've been in Thailand for the last 14 months. But I also told him I have a home in the USA and I pay state and federal taxes in the USA.

Dumb move. By notifying them you forced them to take action so that they can in the future show good faith efforts not to solicity brokerage and investment business in Thailand and thereby not fall under the regulations of the Thai SEC. Fidelity and other US brokerages operate under a "don't ask, don't tell" policy.

Recommend you open an account at Schwab or Vanguard or some other good brokerage and not make the same mistake again.

[RickNew]

Why do you start your response by calling someone "Dumb"? Your communication would have been more effective had you just left out the first two words.

[Misty]

OP - Sorry to hear about this. While some US brokers are set up to work with US citizens who are legally resident outside of the US - most are not. The issue lies in global rules and regulations in marketing mutual funds across borders. It cuts both ways - for example, a Thai asset management company is not allowed to sell its mutual funds to Thais who are resident in the US either.

These rules have been around a long time, but haven't been enforced previously. Their relatively recent enforcement is a by-product of FATCA.

Switching to a US custodial brokerage firm that is set up to work with US expats / even welcomes them is probably a good idea. As a previous poster mentioned, Schwab is one such firm, and there are others. Here's a couple of links of press articles going into this issue in detail:

http://www.international-adviser.com/news/tax---regulation/us-institutions-to-expats-take-your-retirement

http://online.wsj.com/articles/expats-left-frustrated-as-banks-cut-services-abroad-1410465182?KEYWORDS=laura+saunders

[RickNew]

Thank you so much Misty! That is very helpful. This has kind of ruined my day, but your information gives me hope that even if Fidelity does stop managing my account I have options without having to return to the USA! Thanks again Misty..

[Digitalbanana]

I had a similar treatment with Smith Barney a few years ago from their less than helpful advisers when I was found to be outside the US. They wanted to make things very difficult for me, not cut me off entirely but add sky high fees instead. I closed and moved the funds to Etrade. Been using them ever since with a Thai address - but I have to manage my own portfolio with them.

[partington]

Stories like this always scare me because I have a Fidelity IRA through working in the US for a dozen years, was always intending to return to the UK eventually, and was never given any hint by any advisor that having an IRA while living in (and being a citizen of) another country would be a problem in using this account to fund my retirement.

Fast forward 12 years and it seems that this account is not going to be usable. They have already informed me I can't trade in it, but not that they will close it - yet!

I suspect, but do not know, that it is people actively trading and interacting with personal portfolio "advisors" who are having the major problems, because, as mentioned above, brokers legally cannot recommend , urge to purchase or otherwise facilitate the purchase of US funds by people in other jurisdictions. So active portfolios with reviews and regular balancing, switching of funds and so on mediated by a Fidelity advisor are probably doomed.

I am hoping that my IRA, which has no advisor attached to it, and that I have not traded in , or tried to, since leaving the US, will escape notice as it is simply sitting there, and so can't be breaking any international regulations about buying and selling funds in other jurisdictions.

However they know I have a foreign address, and in fact while opening the account I asked repeatedly what would be the problems if any in operating the account from the UK. "None" was of course the reply...

Edited February 12, 2015 by partington

[Dustdevil]

I've lived here for 5 years... And even contacted them directly to get my Fidelity account linked to BKK Bank for EFT transfers... No problem...

Same here, except I have Vanguard funds. I've been investing and trading with Vanguard for nine years without a problem. The trick is starting out with a U.S. street address (I use a friend's) and also associating that address with your credit cards and your bank accounts. I never trade over the phone unless there's an unusual problem. I also use a VPN with a U.S. IP address. On occasion I do need to phone my credit card issuers, in which case I use Skype with a U.S. phone number. I have to answer two or three security questions, but that's not a problem. The only time I ever needed to call Vanguard was to ask about annuities. They didn't care where I was calling from.

[al007]

I am a uk citizen

Interactive Brokers account USA with my thailand address on it also my thai wife is also joint on that account

I set this account up online from thailand and all proof of address etc done online took a couple of weeks bur wonderful

I have a QROPS pension in gibraltar and I self manage again with Interactive Brokers but via the IB UK Site a different legal entity

Maybe look at Intereactive Brokers

[PhillyBoy]

There must be some new laws coming into action. I have Vanguard IRA and Brokerage accounts. Prior to establishing the Brokerage account just last year if I asked for a wire transfer to Thailand from my IRA account it was ok. However, this year, after establishing my Brokerage account I asked for a transfer of funds to a Bank in Thailand. They told me that they could not do it anymore since I established the Brokerage account. I asked why and they just told that it is the rules now. If you have a brokerage account that they cannot send money out of the country to me.

I said to them well cancel the brokerage account and they said no it is too late you already combined the accounts. It sounded ridiculous to me. I had to ultimately transfer money from the IRA to another Bank in the U.S.A. and then have them transfer the lump sum to me in Thailand. I think there is something going on with the U.S. "G" forcing banks to do this. Maybe there are other reporting requirements for Banks who do this from Brokerage accounts. Just a thought.

[avidflyer]

In my experience you can have a Fidelity account while living in Thailand but just not a "managed account". Just set up a new plain old generic DIY Fidelity account.

[ToddinChonburi]

This has always been the law but I think your broker is a fool see if you can change brokers. I have a address in USA, no probblems.

[csabo]

Thank you so much Misty! That is very helpful. This has kind of ruined my day, but your information gives me hope that even if Fidelity does stop managing my account I have options without having to return to the USA! Thanks again Misty..

I have been posting for months that when banking abroad to use HotSpotShield.com. Just don't tell your banks where you are whatever you do. I guess with the OP shooting his mouth off, he is he is worst enemy. I am not saying to lie but "Don't ask don't tell" comes to mind.

I use my Fidelity account everyday with no issue.

Edited February 12, 2015 by csabo