Let say I request an ACATS full account transfer form firm A to B. Assuming account is transferred from A to B successfully, my question is what happens if I by mistake make an ACH transfer of cash to account A (considering Account A is not deactivated or closed immediately in the process of ACATS that could take at least a few days to a week if done online)? Will it be swept back to Account B?
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Meow for ACATS
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My guess is that the transfer will either be rejected, or re-fund account “A”.
The transfer to Account “B” is a distinct transaction that happens at a specific time, they wont continue transferring stuff on an ongoing basis after the transfer has occured.
Note, with a “full account transfer” some firms will charge a fee. But if you only do a partial transfer - even if you list every asset in the account, leaving it with a $0 value anyways - there is no fee. So be sure to check the fee schedule prior to requesting the transfer, to see if you can save a few dollars.
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The feedback I had from another source states: It is not unusual to have some residual income trickling in after the transfer (interest, dividends, etc.). The ACATS will continue to look for residual amounts to sweep over for a period of time.
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Perhaps that’s why there’s often (at least as of the last time I worried about this, which admittedly was years ago) a fee for a full account transfer but no fee for transferring individual assets.
Unfortunately, this particular broker A charges huge fees for inactive and low-balance accounts. That’s why I decided to close the account for good. On top of that, broker B promised to reimburse the account closing fee at Broker A.
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AFAIK the custodian for the old account is responsible for moving any late arriving dividends or interest payments to the new account. I’ve received a transfer 13 months after an ACAT. I couldn’t actually figure out what it was (the amount didn’t match up to any dividends, so I suspect it was interest income for part of the month that they didn’t transfer to the new account for a year).
Regarding my original question, the EFT transfer was returned because the receiving account was closed (according to a notification from the sending bank) and the amount was credited back to the sending bank. I had initiated the full ACAT and EFT on the same day. Apparatenly, the full ACAT closed the account before the EFT.
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I think you mean EFT (Electronic Funds Transfer), not ETF (Exchange Traded Fund).
Sorry, EFT (ACH transfer). I am surprised how fast brokers communicate ACAT information with their counterparties nowadays when you initiate account transfers online!