Frustration with Vanguard

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TTU
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Frustration with Vanguard

Post by TTU » Fri Aug 30, 2013 10:26 am

I manage my wife’s Roth IRA. When I called Vanguard to ask a question about her account, I was told I was not allowed to access her account without an agent authorization form. Understandable, I said, and I told the representative I would no longer do so. Two weeks later, my wife is locked out of her account, told by the website that her password is incorrect. Coincidently and completely unrelated, her email was hacked two days prior. This led us both to believe that her Vanguard account had been hacked as well. We called Vanguard and they explained that they locked the account until I filled out an agent authorization form. So instead of calling or sending an email stating this, Vanguard just locked our account with zero explanation and then left it to us to call and figure out why we no longer had access. Further, the automated response from the website was “incorrect password” vice something more specific, such as “your account is locked due to _____, please call us as xxxxxx” Instead, we are restarting our computer, trying to login from somewhere else, etc.

Next, we requested the agent authorization and received it in the mail 7 days later. They refused to send it quicker unless I wanted to pay for it via a FedEx account. We got the form and called a Vanguard representative to walk us through to avoid any silly mistakes that would invalidate the form. After about an hour, we mailed the form away.

Two weeks later with zero call or contact from Vanguard, I call them last night and ask about the agent authorization. After a lengthy delay, it turns out that we needed a notary to complete the form and our agent authorization is invalid. Again, no attempt to reach out from Vanguard about the status of our account – I had to call to find out the form was incorrect after I could not access my account. I protest, stating that the previous representative clearly said we did not need a notary – then another lengthy delay – and yes, they found the old recording and confirmed their representative told us incorrect information. What’s the recourse? They are sending us ANOTHER agent authorization form, and they won’t even send it faster without us paying for it again! 7-10 days to wait for another form.

All in all, I’m really disappointed in the service I received from Vanguard. I understand I was initially “in the wrong,” but since then they really dropped the ball and didn’t make me feel like a very valued customer. I guess we all make sacrifices to get low ERs.

Cash
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Re: Frustration with Vanguard

Post by Cash » Fri Aug 30, 2013 10:30 am

Will the online option not suffice?

https://personal.vanguard.com/us/litera ... _mode=true

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indexfundfan
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Re: Frustration with Vanguard

Post by indexfundfan » Fri Aug 30, 2013 10:31 am

I feel your pain.

While the following statement probably does not apply to your case, I always feel that it is prudent to diversify assets with different institutions. Not that I think assets would be at risk at Vanguard; but cases like this can take weeks to resolve. This could present a huge difficulty if anyone were to need the money in a hurry.
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stan1
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Re: Frustration with Vanguard

Post by stan1 » Fri Aug 30, 2013 10:32 am

Vanguard has low expense ratios which I believe does impact the quality of their phone/email support. I've received incorrect advice several times from Vanguard, including some advice that would have caused me to realize $10K in capital gains had I done what their agent suggested. Experiences like this do happen at Vanguard (and I suspect other financial institutions) which is why I try to avoid interacting with them if at all possible. The best financial services company is the one you never need to talk to. All of their computers are more reliable than their people.

dbr
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Re: Frustration with Vanguard

Post by dbr » Fri Aug 30, 2013 10:38 am

You don't have to hold your accounts at Vanguard to buy Vanguard mutual funds and ETFs. Lots of people here don't, and it is unfortunate if there is ever confusion over the distinction between what you hold and where you hold it.

That does not mean anyone should not hold assets at Vanguard either.

Sidney
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Re: Frustration with Vanguard

Post by Sidney » Fri Aug 30, 2013 10:50 am

Not to defend their confusing phone service level but the form is available online and the form specifically states that notarization is required.

I have found that information received verbally from VG representatives can vary quite a bit. For some things like retirement plan/IRA technical issues I always ask to speak to someone in the department that specializes in the topic.

It is rare when I can't find what I need in their documents, all of which are available online. I always start there first (e.g. prospectus, brokerage agreement docs etc).
I always wanted to be a procrastinator.

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Toons
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Re: Frustration with Vanguard

Post by Toons » Fri Aug 30, 2013 11:01 am

AGENT AUTHORIZATION online is the way to go :happy
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

Cash
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Re: Frustration with Vanguard

Post by Cash » Fri Aug 30, 2013 11:01 am

Sidney wrote:Not to defend their confusing phone service level but the form is available online and the form specifically states that notarization is required.

I have found that information received verbally from VG representatives can vary quite a bit. For some things like retirement plan/IRA technical issues I always ask to speak to someone in the department that specializes in the topic.

It is rare when I can't find what I need in their documents, all of which are available online. I always start there first (e.g. prospectus, brokerage agreement docs etc).
Agreed. And you don't even need a notary if you do everything online (probably complicated now that the OP's wife's account is locked, but perhaps they can unlock it for this purpose).

JW-Retired
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Re: Frustration with Vanguard

Post by JW-Retired » Fri Aug 30, 2013 11:49 am

I too have found the 800 number phone support from Vanguard/Fidelity/my Ing 401k admin, IRS, SSA, my Senior HMO, ... to be not very reliable. It's seems to be all hit or miss at best if the number I call begins with 800. If you think you got a clear answer you had better verify it somehow/somewhere before you act on anything important.

The 800 malady seems not to be limited just to client support 800 numbers, retail seems to have the same disease too. Just Wednesday I was provided 3 widely different delivery dates from 3 different 800 number people spread across the country regarding a refrigerator I ordered from a big box store online. Plus the web site would make a 4th date. The first call left a message that said they would deliver the next day, which I couldn't support and proved to be patently impossible for the store as well. I finally have their new "earliest" date of a couple of weeks from now. We shall see.
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ProfessorX
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Re: Frustration with Vanguard

Post by ProfessorX » Fri Aug 30, 2013 11:56 am

I downloaded that form online. Although maybe you don't have online access because you were locked out.

Vanguard is very serious about "agent authorization" and making sure that people who are accessing the account have the proper authorization. I came across a similar situation with my wife's account while we were in the process of doing agent authorization.

The good news is that Vanguard is trying to prevent fraud seriously. The bad news is that if you don't take it seriously that your wife's account is your wife's account and her account only before she officially gives you agent authorization, then Vanguard might lock you out if you say the wrong things to them over the phone about accessing your wife's account.

E.g. if you tell them "I manage my wife’s Roth IRA" then they will lock you out. Technically according to the law you should not be doing that in her name. They have liability issues that they have to take seriously. :oops:

dbr
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Re: Frustration with Vanguard

Post by dbr » Fri Aug 30, 2013 12:06 pm

ProfessorX wrote: Technically according to the law you should not be doing that in her name. They have liability issues that they have to take seriously. :oops:
In which case this is absolutely inexcusable:

"I protest, stating that the previous representative clearly said we did not need a notary – then another lengthy delay – and yes, they found the old recording and confirmed their representative told us incorrect information."

Texas hold em71
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Re: Frustration with Vanguard

Post by Texas hold em71 » Fri Aug 30, 2013 12:20 pm

When my husband told them on the phone that he was going to let me log in to his account, we both got letters in the mail scolding us and urging us to change our passwords. I understand that it is something the lawyers and insurance companies make them do, so I shrugged it off. We did not get locked out of our accounts and that would have made me quite angry too.

They are a bit stodgy on things - that I can say. They require me to set up our joint checking account as a transfer option to our joint taxable account under both of our names in their system. Did the exact same thing twice confirming the small deposit transactions twice. :confused

We live in a community property state, been married for 20 years and started with nothing but a lot of potential. What's mine is his and vice versa. But not every marriage is set up the same way and Vanguard doesn't know which type of marriage we have. I do like that they have the account agent option and even though it took a few calls to get it right, I think we have it all done now. Although I am still waiting for him to give me permission to transfer money from our joint checking account into his individual IRA and Roth accounts since apparently that is not covered as an authorized agent activity. I may just have him log in and set it up himself if he can remember his password. 8-)

Of course they had no problem with me moving money from our taxable account into his IRA, so there are ways to get around these things.

MathWizard
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Re: Frustration with Vanguard

Post by MathWizard » Fri Aug 30, 2013 12:38 pm

To the OP,

I would agree that a notification would have been nice, and the customer rep
should not have told you a notary was not needed, and I know you are frustrated, but
I actually like what I hear.

This means that Vanguard is not going to let just anyone online to access my account
unless they KNOW that I requested it.

I'm happy with Vanguard keeping things low-cost and not Fed-Ex'ing paper across the US, and with them
being sticklers on Security. There are plenty of places that will serve you donuts and coffee when you
visit for a 1.5% ER.

Without the Notary, how does Vanguard know that somebody just did not forge your wife's name?
After all, someone tried to access her account information, and they do not know it was you.

The account lock seems strange. I would think that you would have been notified.
Perhaps they did by email, and your notification got lost in that coincidental email hack.

The email hack and the account lock may not be unconnected.
Given that most login sessions lock after a few attempts, a way thieves to get onto some account
is to collect many account login names and try a set of passwords against each of them.
Sometimes you get a hit. That leaves thousands with locked accounts,
but theives don't care about that. The email that was hacked may have contained information
about the Vanguard account, so it was targeted. I'd check any other financial institutions
you have online access to.

The sending of the documents to you by mail seems strange. The documents are online, I would
have thought you'd have gotten instructions on how to do this, or your wife would have been
sent email on how to get it, or they would have been sent as an email attachment, rather than
spending money on postage. Sending them back by mail seems reasonable because they would
contain notarized signatures.

jimkinny
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Re: Frustration with Vanguard

Post by jimkinny » Fri Aug 30, 2013 1:53 pm

I would prefer any institution to error on the side of caution if my life savings are involved. Perhaps because I was involved in the medical field and had to be aware of federal laws regarding the privacy of patient information, I kind of side with Vanguard.

If someone calls Vanguard and has information about my I would be pleased that Vanguard locked the account. As soon as I knew it was locked, I would call Vanguard of course. Maybe a proactive call to your wife would have been in order or maybe a letter but then again, how does Vanguard know what is going on at the receiving end? Maybe I watched too much TV when I was young.

jim

robertalpert
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Re: Frustration with Vanguard

Post by robertalpert » Fri Aug 30, 2013 11:43 pm

I also manage my and my wife's investment accounts. A few years ago, arranged for "limited authority" to act on her accounts. But after reading your thread, concluded that perhaps it would also be good to grant wife similar "limited authority" on my accounts. Even though she is not interested in doing transactions, if something were to happen to me, she could do some things from her logon.

The online form was easy to use, and limited authority was activated and working in just a couple minutes. No need for notary when opting for the online form.

Limited authority is all you really need for most investment purposes. OPs problem with locked account access will need to be addressed first. But if you are seeking "full authority", then online completion might not be do-able. That probably requires paper forms and signature guarantees.

TTU
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Re: Frustration with Vanguard

Post by TTU » Sat Aug 31, 2013 5:52 am

All,

Thanks for the responses. Again, I want to reiterate I wasn't upset with Vanguard for locking me out of my wife's account - that was completely justifiable. I'm frustrated that they didn't let us know they had locked the account, that they provided incorrect instructions (substantiated by recordings), and failed to extend any sort of penance for delaying this process even further ("hey sir, sorry we gave you bad information, we will expedite you this form so we can get this taken care of," etc.). Thank you again for all the recommendations as well.

TTU

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rustymutt
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Re: Frustration with Vanguard

Post by rustymutt » Sat Aug 31, 2013 6:33 am

I've been through this whole process with my wife's IRA, and I had no issues whatever. We printed the form off, signed in front of a bank manage with a notary license, and sent it back in via mail. Any service issues we've had are minor.
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ProfessorX
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Re: Frustration with Vanguard

Post by ProfessorX » Sat Aug 31, 2013 6:45 am

Yes Vanguard is usually not going to "make it worth your while" when they make a mistake or mess up they often simply apologize. Their goal is to have very low expense ratios, and paying for Fed Ex overnight every time they make a mistake would raise expense ratios and the rest of us would be paying for the mistakes. Which is contrary to their mission. :D

Vanguard makes it up to us every day with the rock bottom costs.

lwfitzge
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Re: Frustration with Vanguard

Post by lwfitzge » Sat Aug 31, 2013 7:04 am

I did this completely online without any delay (like 5 min!) in the last year. It was simple, required no signatures. No form to send in. I recall my wife received an email and she had to click yes to complete and give me agent authority. I gave her agent authority on my as well. I see the biggest failure w the VG rep is why did he/she did not encourage you do it online and avoid the mess, cost, delay.

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pennstater2005
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Re: Frustration with Vanguard

Post by pennstater2005 » Sat Aug 31, 2013 7:38 am

Cash wrote:Will the online option not suffice?

https://personal.vanguard.com/us/litera ... _mode=true
Thanks for the link. Super easy and my wife was able to let me gain full authority in only a few minutes.
“If you think nobody cares if you're alive, try missing a couple of car payments.” – Earl Wilson

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SnapShots
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Re: Frustration with Vanguard

Post by SnapShots » Sat Aug 31, 2013 7:48 am

VG, IMO, does not have excellent service. You do get different answers talking with different reps and they don't always follow through. I do as much online as possible and avoid calling or asking questions.
You can get better service somewhere else but you'll pay for it.

It is a real pain to get locked out. DON'T TYPE IN THE WRONG PASSWORD, that mistake can haunt you for a while. :greedy
the best decision many times is the hardest to do

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JamesSFO
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Re: Frustration with Vanguard

Post by JamesSFO » Sat Aug 31, 2013 8:06 am

I think there is a little bit of VG culture where they do not invest in some of the niceties even at the Flagship level. I've had my representative switched on me in the middle of working on tasks and VG definitely does make mistakes. It took all of May for them to fix an address mistake THEY created.

That said, I've noticed a general trend over the last few years, I can do more than ever via websites, so when I am calling it is most likely a tricky case. But the 800-center staffing model (even for flagship) seems to be one of handling routine situations.

Hopefully this experience does not completely sour you on keeping your accounts with vanguard because on the core product: low cost index funds that track their indices well, they really do deliver.

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