Direct Registration (in your name) vs "street name" for top SIPC protection

[murphy_p_t]

from the SIPC brochure: http://www.sipc.org/pdf/HSPY_English_2011.pdf

Terms of SIPC help. Customers of a failed brokerage firm get
back all securities (such as stocks and bonds)

***
that already are
registered in their name or are in the process of being registered.
***

After this first step, the firm’s remaining customer assets are then
divided on a pro rata basis with funds shared in proportion to the
size of claims. If sufficient funds are not available in the firm’s
customer accounts to satisfy claims within these limits, the
reserve funds of SIPC are used to supplement the distribution,
up to a ceiling of $500,000 per customer, including a maximum
of $250,000 for cash claims. Additional funds may be available
to satisfy the remainder of customer claims after the cost of
liquidating the brokerage firm is taken into account.

Has anyone looked into registering their holdings (shares, etfs, bond) in you own name to get highest SIPC protection? Can this be done for the 30 year LTT & VTI?

[TripleB]

If only Treasury Direct allowed Retirement Accounts. The irony is that the reason TD doesn't offer retirement accounts is because of the paperwork nightmare it is to be an IRA custodian. And the reason it's a paperwork nightmare is because of the government's insane bureaucracy.

Then again, I've heard TD has horrible fraud protections, meaning if someone hacks your account, they tell you to f-off, whereas a legit brokerage would assist you in recovering your assets, or make you whole out of their pocket if necessary.

I use a huge complex unique password for all my financial accounts, but that doesn't mean it can't be hacked through various means that are no fault of my own, but simple how the internet works, and how TD handles their IT security, which is probably not the best, based on what I've seen in other government projects I've worked on.

[rickb]

If only Treasury Direct allowed Retirement Accounts. The irony is that the reason TD doesn't offer retirement accounts is because of the paperwork nightmare it is to be an IRA custodian. And the reason it's a paperwork nightmare is because of the government's insane bureaucracy.

Then again, I've heard TD has horrible fraud protections, meaning if someone hacks your account, they tell you to f-off, whereas a legit brokerage would assist you in recovering your assets, or make you whole out of their pocket if necessary.

I use a huge complex unique password for all my financial accounts, but that doesn't mean it can't be hacked through various means that are no fault of my own, but simple how the internet works, and how TD handles their IT security, which is probably not the best, based on what I've seen in other government projects I've worked on.

I can't comment on their response to a hacked account, but TD's login security seems better to me than most.  They used to use a "key card" you kept in your physical possession for a challenge-response, in addition to a password you enter via a virtual keyboard (so a program on your computer watching your keystrokes can't capture your password).  They've recently replaced the key card with registering the IP address you're originating from - if you are logging in from a new host they send a 1-time password to your registered email account which you have to enter in addition to your own password.

[TripleB]

I can't comment on their response to a hacked account, but TD's login security seems better to me than most.

That's the security you can see. A hacker won't necessarily come in through the front door trying to use the key.

[hedgehog]

Long story short: pros and cons of maintaining my portfolio with a 'street name' brokerage vs. an 'equities in my name' brokerage? And a separate list of both types? I greatly appreciate you.

[Libertarian666]

I don't know about those securities, but you can still get physical share certificates for CEF (and probably GTU, since they are run by the same people).

Just don't go boating with them, or you'll have to post a fairly expensive bond (3%? of the value) to get them replaced.

[smurff]

It's a useful idea--Manywhich means you'll be dissuaded at every turn from doing so.

Brokerages charge a steep fee to transfer securities from street name into your name.  It varies from broker to broker, but $30 - $75 are familiar fees for doing this, per security.  You might be able to eliminate all or part of these fees if your account is big enough. 

Back when MFGlobal went bust and stole customer funds, and nothing was done about it by TPTB (even today), there was lots of interest in the entire personal finance/investment community in moving to direct registration.  Alas, the inertia of everyday life gets in the way of good intentions.

I'm not certain whether it can be done for retirement and similar accounts that are with brokers.  (All of the stock portion of my PP is invested with retirement accounts.) At least not without getting a self-directed account and dribbling away your assets in even more fees.

You can also have direct registration if you buy stock via DRIP and DSP (direct stock purchase) plans, usually  fee-free or low fee.

[ns2]

Then again, I've heard TD has horrible fraud protections, meaning if someone hacks your account, they tell you to f-off, whereas a legit brokerage would assist you in recovering your assets, or make you whole out of their pocket if necessary.

That sentence peaked my interest in this resurrected topic since I just opened an account and bought $20k of I-bonds for me and my wife.

Are there any real stories out there about losing your money because somebody hacked into your TD account and then the government telling you to f-off? Even though it is the government and I wouldn't put it past them if they could get away with it I can't believe they would kill the goose that lays the golden eggs for them by doing this.

As somebody else said I find they have tighter security than any other site I visit. So far they have sent a temporary password to my email every time I have tried to log on.

[hedgehog]

You can also have direct registration if you buy stock via DRIP and DSP (direct stock purchase) plans, usually  fee-free or low fee.

I know. The question is can you do it with ETFs and is it worth it? Compared to Interactive Brokers (for a non US person) for example.

[hedgehog]

Then again, I've heard TD has horrible fraud protections, meaning if someone hacks your account, they tell you to f-off, whereas a legit brokerage would assist you in recovering your assets, or make you whole out of their pocket if necessary.

That sentence peaked my interest in this resurrected topic since I just opened an account and bought $20k of I-bonds for me and my wife.

Are there any real stories out there about losing your money because somebody hacked into your TD account and then the government telling you to f-off? Even though it is the government and I wouldn't put it past them if they could get away with it I can't believe they would kill the goose that lays the golden eggs for them by doing this.

As somebody else said I find they have tighter security than any other site I visit. So far they have sent a temporary password to my email every time I have tried to log on.

I don't know much about US internet banking security (in Europe two factor authentication is mostly used) but I guess a good security measure would be if you separated your investment account from which you can only withdraw funds to a separate checking account in your name? The attacker hacked your account - he can only withdraw to your checking account.