I just received an email from Schwab with the subject line “Your account(s) will be restricted“.
Here’s the text of the email:
Accounts for clients located in the Philippines will be restricted. Read below to learn more.
After a recent review, we have decided that, starting 06 December 2022, all accounts for clients residing in the Philippines will be restricted.
What this means for you.
We will place your accounts in a restricted, liquidations-only status. This means that you will be limited to closing existing positions, and you will not be able to open new positions or deposit new funds.
Your next steps.
You may liquidate or transfer your account assets to another firm.* Here is how:
- To liquidate your investment positions and request a wire transfer, contact us at one of the numbers listed below.
- To transfer your account(s) to another firm, request an account transfer form from the receiving firm. Once you have initiated a request, contact us at one of the numbers listed below, and we can help the receiving firm facilitate the transfer.
You can maintain your account(s) if you reside in a non-restricted country or have a U.S. Military & Diplomatic mailing address (APO/DPO/FPO). Contact us to update your address.
We regret any inconvenience this change may cause you. If you have questions or need help, please reach out to our Global Investing Services Team at 800-992-4685, 5:30 p.m. ET Sunday to 5:30 p.m. ET Friday. Clients of Charles Schwab, Hong Kong, Ltd., call +852‐2101‐0500. For others outside the U.S., contact us at +1-415-667-8400.
As you can see, no explanation for this action is given. Needless to say, this is very unfortunate and inconvenient and I will have 60 days to find another brokerage to transfer to.
any ideas of a good alternative to Schwab? hassle got same email hmpf.
I think I’ll be initially looking at Interactive Brokers.
Interactive brokers. Transferred mine from schwab to ikbr in less than a week.
Why is this being done?
Some are speculating that it’s due to the Philippines being in the FATF “grey list”. If that influenced Schwab’s decision at all, I don’t think that’s the only reason because some countries in that list are still supported by Schwab (like UAE and the Cayman Islands). Among ASEAN countries, Vietnam is also blocked by Schwab though I don’t know if that’s a recent development. Schwab also still does not offer online accounts to to Singapore residents, after closing up their physical Singapore office in 2019.
Schwab probably just decided that the risks it faces and regulations it has to follow is not worth the business of catering to Philippine residents.
TD issued the same restriction and timeline. But after emailing them, you are actually free to leave your account as is, or transfer to another external broker even after December 6th. Likewise, DRIP enrollments continue to reinvest dividends after the deadline given, should you wish to leave your account as is, albeit in a “restricted” state. Very inconvenient though. =(