Going private transactions can often result in some complicated bookkeeping for online brokers. As you might recall, on December 5th I made two new purchases for my son’s Coverdell Education Savings Account. One of these purchases was for Refocus Group (RFCS). A few days later, Refocus Group made their reverse split and cash out effective.
Something strange happened in the Firstrade account. The reverse split and cash out was not registered. I think it had to do with the fact that I bought the shares right before the reverse split transaction was effected. I called Firstrade and I also sent them an email indicating my problem.
Here’s the excellent response I received:
Dear George XXXXX:
Thank you for e-mailing Firstrade. Please pardon the delay in our response.
Per our investigation, it is indeed a mandatory re-organization. However,
there is an error in the processing and the last 1,000 shares that you
purchased were not processed. We are currently tracking down these shares
and they will be processed accordingly. Please allow time for processing.
Should you have any additional questions, concerns, or suggestions, please
feel free to contact us.
Firstrade Client Services
I am glad they are investigating this issue and are not ignoring it. I’ll let you know how it gets resolved.
I’m have another going private transaction problem in my BrownCo account, and that response so far has not been very satisfactory. I’ll tell you about it shortly.