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Is Zecco A Scam or Legitimate?
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(Updated Sept. 17, 2009) Zecco recently updated their free trades program to have a requirement of a $25,000 balance!
Anytime I hear free I immediately think “scam.” Let’s be honest, the person offering up something for free is looking for some sort of benefit and unless I can find out what the benefit is (especially if I’m giving them all the information they need to steal my identity), I’m going to assume the benefit for them is to steal my identity.
So, is Zecco legitimate or a scam? I let time do the testing because most people are savvy enough to sniff out a scam relatively soon, especially if you let mainstream media do the vetting. Right now, they appear legitimate and that’s because they’re actually a division of Equinox Securities, Inc. According to the NASD Broker Check, Equinox Securities (CRD# 135398, SEC# 8-66916) registered as a corporation in California on 01/21/2005 and is located in Ontario, CA. It’s currently not suspended by any regulator and has not yet had any Arbitration Awards, Disciplinary and/or Regulatory Events. I downloaded the full Equinox Securities report and you can see Zecco Trading listed on page 4.
So, the NASD knows about them but that doesn’t necessarily mean that they’re 100% legit, brokers with fraudulent intentions can register – they just can’t have committed fraud yet. That’s where the second line in their little fine print comes into play, they are a member of SIPC (Securities Investor Protection Corporation), an organization created by Congress in 1970. What do they do?
When a brokerage firm is closed due to bankruptcy or other financial difficulties and customer assets are missing, SIPC steps in as quickly as possible and, within certain limits, works to return customers’ cash, stock and other securities. Without SIPC, investors at financially troubled brokerage firms might lose their securities or money forever or wait for years while their assets are tied up in court.
Now, just because they say they’re in the SIPC doesn’t make it so, but I was able to confirm it through SIPC’s member check. Equinox Securities Inc. located at 2084 E Francis Street, Ontario CA 91761, an address that matches the NASD information. It’s a Cold Fusion script so I couldn’t link directly to the results but they’re in there.
Again, is participation in this program a guarantee it’s not fraudulent? Of course not, but that’s a lot of hoops to jump through if you’re a scam. So, after a brief bit of research, Zecco passed the extensive sniff test for me but to be honest, all the talk of their abysmal customer service makes me think you get what you paid for. Trades are cheap, why not go with a firm that has some credibility in the marketplace? I, for one, am going with TradeKing, twice named Smart Money’s #1 Discount Brokerage of the Year 2006 & 2007 (they removed the discount category after 2007), where trades are only $4.95. Smart Money put Zecco dead last in customer service.
I think customer service in a brokerage is crucial. If I have a problem, I don’t want to wait on hold.
{ 204 comments, please add your thoughts now! }
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I have recently received a $2,000 maintenance call and my stocks were all paid for with no margin balance. Nothing but level one options. Covered calls is the only ones sold. Has anyone ever heard of that before?
The previous comment is referring to a ZECCO account of course.
that’s the most random thing ever, you MUST be leaving some information out LOL
I love Zecco. Best broker I’ve ever had.
I’m a former Ameritrade user. I switched to Zecco and have been very satisfied with my decision. I’m a recognized as a pattern day trader and I average around 35 trades per month.
I’m really shocked at some of the comments here. I’m starting to believe that some of these comments were paid for by competing online brokerages, because I’ve only experienced ONE problem with Zecco since January 2008, and that problem was a small error in buying power that was quickly fixed after a phone call.
I’ve never had to wait over 5 minutes for customer support, and their cs guys are actually COMPETENT. I’ve always had my problem solved within minutes.
My father and I switched brokerages on the same day. He switched to E-Trade, and I switched to Zecco. My ACH deposit arrived in my account much faster. My father’s funds were put on hold by E-Trade for 10 days. My funds arrived in 3 days.
My ONLY complaint about Zecco is that short positions are not available for every stock I would like to short.
I’m a real Zecco user and I will never ever use them again. Their servers go down without backups and then you “try” to call them and you will sit on hold for at least an hour. Customer service is poor, they just don’t care. I am PO’d.
Mike T – Zecco sends you an e-mail notifying you to disable paper statements. They provide you instructions in the e-mail on how to disable paper statements as well.
Incompetent people like you are giving Zecco a bad rep. I’m sure some of these complaints are legitimate, but the majority of them are nonsense.
I’ve used Zecco for 12 months now. I have not paid Zecco a penny, because I only use my ten free trades per month. No hidden charges. The profits are mine to keep, no commission. I am always pleased with the execution prices of my trades – often better than the limits I’ve set. I got my brother and mother to open Zecco trading accounts. I would recommend it to anyone. Zecco rocks!
wow… I was just about to open an account with Zecco, but when I saw they wanted all the personal information, I decided to check out reviews and found this blog. I am probably the market’s biggest newbie on investing and am glad I read these comments. I don’t think most would make these comments – negative or positive – if there wasn’t some truth to each. Overall, I don’t think someone as green as myself should chance an experience with Zecco – especially if their customer service lacks as much as mentioned. Maybe everyone hasn’t had a bad experience with customer service, but enough to make me really leery.
Thanks. Will read more reviews and compare to reviews to other online companies. Not a big trader, but don’t want to get started on the wrong foot.
I got a very bad experience, I made a deposit through ACH and find my bank account has been closed. Their web site has no way to cancel the transaction and the phone are holding too long that I am able to talk to the customer serive after trading hour. There’s no way to cancel the deposit request and they charge $25 with magin calls on my account. Now I have to paid the interest on negative balance. That’s the first time I heard that no way to cancel the ACH transaction during business hours. Now I know “no free lunch”. I have confident that some day you lost your money and they have something coming up for it.
After realizing that I paid almost 225 for 5 trades over the phone with TD with brokerage seems interesting. I making about 50 trades a month now, but I am concerned about getting the best execution. Who offers the best execution anyway?
I am constantly adjusting limit orders and do not want a platform that sucks . Can anyone chime in?
ZECCO SUCKS. Their site is so sub-par that in any heavy trading day it goes down.
I lost money with Zecco. Their customer service just says ” Sorry, our IT department is working on the issue”
For weeks, their site cannot handle the traffic, you can see it on the response times. Today, with a very heavy trading day, it is simply FROZEN. Their customer support, useless, just give you an option to do a trade over the telephone. After being transferred to a broker, waited for 10 minutes and got so angry, I hang up.
ZECCO SUCKS – DON”T USE it, if you have it RUN away
I’ve opend zecco account only three month ago. It was pretty good for two month. However, recently, their web site is very hard to be logged in when I have to place urgent trading.
Yesterday, I have placed an order for cancelling at 3 pm, and it still in cancelling process so I can’t place a new order all day. So I tried to call the customer service since 9.30 am, but as of now at 2 pm I am still holding the phone for someone to answer.
Since today’s stock market is crazy my stock gone up so high and fallen back again.
My loss is only about $2000 so It’s not worth to sue this firm. Does any one know if I can get paid back my losses from the zecco. Or any class action going on?
I finally received a phone call from their customer svc and he will try to work for me as if I sold the stock at the higher price. I was thinking to withdraw all my fund from my account, but may be I should wait little more to see if there quality of service improves.
Zecco is not a scam but try getting your money out. It’s hell this is my third week trying to get my money out…they give you one reason after another and cancel your request.
Another issue with Zecco …when the market goes crazy, their site goes down. This is the main reason I decided to move my money. This happened 4 -5 times in the last two weeks. When I needed to close my positon, the site was not available.
And now, taking out my money is another up hill struggle.
It’s the most incompetent and unprofessional company that I’ve ever worked with…and in times like this, I don’t know how people can feel comfortable to put money in a company like this.
for a saving of $45 a month (10 trades @ $4.5) you’re risking your money and time. NOT WORTH IT
I HATE Zecco! I’m in the process of getting my money out and switching brokers (not to digress, but I’m going to Sogotrade and I hope it’s better).
First of all, I haven’t even had this for a month, so I haven’t had any issues with it crashing on me. But it was crazy how it wouldn’t let me sign in. I could sign into the website itself, but when going into the trading center, it would always tell me I wasn’t signed in even though I would enter my trading key a million times. I have customer service’s phone number memorized. To their credit, they did end up fixing that issue. However, I couldn’t use their premium tools because it tells me I’m not logged in (and surprise, surprise, I am in fact logged in) and customer service has put me on with IT and they couldn’t fix it.
Their execution times suck, too. I’ve lost money because of them to the point where I don’t even care who I end up with since they can’t be worse than Zecco. I put in a market order buy at 4:11pm and it didn’t execute until the next day. That’s messed up.
Bottom line: This website sucks! Get out while you can.
The market closed at 4:00 PM ET. You ordered at 4:11PM. How can Zecco execute your order when market is closing?
Perhaps they executed it afterhours? I don’t know Zecco’s afterhours policy.
4:11pm is after market hours, and they do not do after market trades so of course it is execute next day…u are one weird person. Btw, did you hear about their october free stock trades promotion?
Zecco is horrible, i mean horrible.
The site works barely and I’ve lost money for not being able to access the service when i need to.
I hate this company, they are not a REAL trading company, they just play one on TV. I’m pulling my money out today.
Free?… You get exactly what you pay for.
Hey, I really want to thank all of you for discussing Zecco (both good and bad). I read about Zecco on a blog and was thinking about transferring from my TDAmeritrade account to Zecco. Although some comments were extremely useful, the transaction fees of trading adds up in the long run to where I could have used that money to buy more stock in order to increase my financial position. That’s where the potential of using Zecco came into play during my due diligence of researching Zecco. However, sometimes it’s better to pay a transaction fee knowing that you’ll have limited issues (or any at all) with the firm. The comments on this board has led me to the decision to stay with TDAmeritrade. Although I loved the idea of saving $9.99 per trade for 10 trades per month (which translates to $99.90 per month), I’d rather pay that amount and know that I’m dealing with a company that works for me and offers outstanding support (based upon my experience). I’m sure that many people have had good experiences with Zecco, but it seems like there is a recurring pattern of caveat emptor pertaining to Zecco with respect to hidden fees/customer service issues/transferring your money out. Now I’m not here to recommend Ameritrade because I’d love to use a company that charges less, but it works for me right now. Regardless though, I want to say thanks to everyone for providing information pertaining to Zecco. Good trading to everyone.
Dave
Stay away from them.
They lost me over $50,000 over this year, all because of their “margin requirements”. They exercised unauthorized trades in my account, even though I had enough cash, had a margin account, and was not using any of their money (did not borrow anything!).
Their software is vastly inferior to other brokerages. They send you completely outdated information or provide no information on margin calls which they then upload just at the last minute and ante-date it so to appear as if they sent it a day before. They also can mark your account as a day trading account even though you had not made any trades at all!
I am currently seeking an arbiter to file a complain. Please, if you know a good one let me know. I also would join any class suit against this company.
i don’t believe you lost that much, if you’re a day-trader and you lost that much, too bad! It is YOU the day-trader that made the market crash. I hope you day-traders lose all your money,
Jumbo, Don’t judge when you have no facts. You can, of course believe what you want. I am not a day trader. The Zecco brokerage sold my positions and made me a large loss. That was the comment about. If you are angry at day-traders, what do you think about all the “market makers” that do day-trading for living and manipulate billions? They make the market and stocks to crash – for their greed and fear.
Zecco attempts to treat every client fairly and I’m sorry if the experiences of some on this thread have not lived up to our standards. Every situation is different and we do our best to provide good customer service.
We are not perfect and we are continually trying to improve. In addition, our recent free trading for the month of October has been our effort to apologize for our errors and thank you for your patience.
well said, are you a Zecco Rep?
He is according to the URL he left…
then again, you don’t know if he is just posing as one LOL