Vanguard blocking SOME exchanges/sells, why?

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Topic Author
cliffedelgado
Posts: 108
Joined: Fri Apr 16, 2010 1:52 am

Vanguard blocking SOME exchanges/sells, why?

Post by cliffedelgado »

Hi,

We are seeing Vanguard blocking exchanges from and sells of some Vanguard mutual funds. When attempting to exchange, some funds are grayed out with the message: "This transaction can't be completed online. Call us at 877-662-7447 for help." When attempting to sell, those same funds are also grayed out with the message: "Your transaction can't be completed. Call us at 877-662-7447 for help."
  • This is on the old mutual fund platform.
  • All funds are Admiral funds.
  • All the funds that are blocked had dividends reinvested at the end of March. (3/19, 3/26, 3/31) I don't see any short term redemption fee for the blocked funds.
  • All the funds that are NOT blocked did NOT have any dividends reinvested at the end of March. This and the above are the only pattern I see so far.
  • All funds have dividend reinvestment on.
  • There is no discernible pattern from the value or gains in each fund. All have gains from both covered and uncovered shares.
Any ideas why ? Aside from calling, any tips from past experience?
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David Jay
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Location: Michigan

Re: Vanguard blocking SOME exchanges/sells, why?

Post by David Jay »

Do you have a specific need or requirement to stay on the MF platform? I am sure you have received multiple requests from Vanguard to change to the brokerage platform.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
Makefile
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Re: Vanguard blocking SOME exchanges/sells, why?

Post by Makefile »

You don't mention whether this block is a recent problem or if it has always been that way.

Is it possible those particular fund accounts were opened a very long time ago? Like by a paper application and check? Maybe you opted out of telephone/computer access at the time.

Per Vanguard's How America Invests 2020, 60% of Vanguard accountholders either have both mutual fund accounts and brokerage accounts or only brokerage accounts, which means that 40% of the customer base still has nothing but mutual fund accounts. So I doubt they would do something as drastic as locking out particular funds at this point.
Topic Author
cliffedelgado
Posts: 108
Joined: Fri Apr 16, 2010 1:52 am

Re: Vanguard blocking SOME exchanges/sells, why?

Post by cliffedelgado »

David Jay wrote: Wed Apr 21, 2021 5:14 pm Do you have a specific need or requirement to stay on the MF platform? I am sure you have received multiple requests from Vanguard to change to the brokerage platform.
No specific requirement to stay on the MF platform. I will consider advising the account owner to transition.
prd1982
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Re: Vanguard blocking SOME exchanges/sells, why?

Post by prd1982 »

I’d call Vanguard and ask for the reason before suggesting your friend make any changes.
Topic Author
cliffedelgado
Posts: 108
Joined: Fri Apr 16, 2010 1:52 am

Re: Vanguard blocking SOME exchanges/sells, why?

Post by cliffedelgado »

Makefile wrote: Wed Apr 21, 2021 6:54 pm You don't mention whether this block is a recent problem or if it has always been that way.

Is it possible those particular fund accounts were opened a very long time ago? Like by a paper application and check? Maybe you opted out of telephone/computer access at the time.
This is a recent problem that we never faced before, as we signed up for online access a little more than 14 days ago. I understand there is a hold of 7 or 14 days on new online accounts, but we seem past that.

All these fund accounts were opened a long time ago. After you brought this up, I now notice that those being blocked were all initially bought on the same day in year X. And the ones not blocked were initially bought in year X+2. Both years prior to 2000. What you are raising seems like a possible reason, thanks! Does anyone know if Vanguard actually had or still has this opt-out of telephone/computer access on a per fund basis?

edit: To be clear, all the funds are in the same account, just different mutual funds.
userwithconcern
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Re: Vanguard blocking SOME exchanges/sells, why?

Post by userwithconcern »

Can you please make a post on their response after you call them?
Topic Author
cliffedelgado
Posts: 108
Joined: Fri Apr 16, 2010 1:52 am

Re: Vanguard blocking SOME exchanges/sells, why?

Post by cliffedelgado »

userwithconcern wrote: Wed Apr 21, 2021 9:26 pm Can you please make a post on their response after you call them?
I hope so. That would mean we actually called Vanguard, which the owner doesn't want to do :?
Broken Man 1999
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Re: Vanguard blocking SOME exchanges/sells, why?

Post by Broken Man 1999 »

Why not send Vanguard an email if the owner doesn't want to call?

Emails are my preferred communications for any online account I have. No time spent on phone, playing phone tag, etc.. No need to explain to someone else what your issue might be, if the original solution didn't work satisfactorily, as the email has the entire history of the communications.

Much more efficient, for my needs.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go." - Mark Twain
Topic Author
cliffedelgado
Posts: 108
Joined: Fri Apr 16, 2010 1:52 am

Re: Vanguard blocking SOME exchanges/sells, why?

Post by cliffedelgado »

OP here bringing partial closure to the thread.

The lock persisted for years. The owner of the account ended up calling, but the representative couldn't give a good answer. They were advised to send in a "Letter of Authorization" to unlock those blocked funds. The letter was mailed in, but we were still blocked.

When transferring the funds to a different Vanguard account, the representative discovered there was some type of lock, that he or she had fortunately just learned how to resolve. They removed the lock and successfully transferred the funds to a new brokerage account.

In the new account, the funds can now be sold.
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