I am a long-term buy and hold investor who focuses on Dividend Growth Stocks (hence the substack name and my old blog name).
I have long discussed the importance of buying good companies at good prices, and then holding on to them, basically “forever” (or at least my sell criteria hits).
I have long followed the philosophy where checking my accounts is really not helpful, because it could trick me into selling a stock low for example, if I panic.
I still believe in a coffee can type portfolio, a set it and forget it (within limits) strategy. Albeit I do monitor the dividend growth lists, dividend increases, and companies on my watchlist and portfolio. But this post is not about the portfolio holdings per se.
It is about monitoring your accounts.
About an year or so ago, my account at Schwab was a target for a fraudulent checking scam.
This experience led me to research and uncover a whole plethora of scams that hit brokerage and bank accounts. These scams can drain your hard earned money.
Worst of all, it is sometimes unclear who is on the hook to recover or reimburse you from fraudulent activity. Even if you get reimbursed eventually, the financial company would take its sweet time in doing so.
Check Fraud
Let me tell you about my Schwab experience:
They handed $2,000 of my hard-earned cash to scammers using two forged checks… and 90+ days later they were still “investigating” with zero refund. Their famous Security Guarantee was starting to feel completely worthless.
Here’s exactly what happened:
Scammers somehow got my checking account number and routing number, then printed two fraudulent checks (both under $1,000 each).
These checks had:
• Wrong payer name — not mine
• Signatures that didn’t match mine at all
Yet Charles Schwab cleared and paid both anyway.
I monitor my accounts every single day, so I caught the fraud just 2 days after the checks posted and called Schwab immediately. Their reps opened an investigation and assured me: “It can take up to 90 days, but don’t worry — our Security Guarantee will make you whole.”
I’ve followed up multiple times since. Every response? “Still investigating. No updates.”
This exact forged-check scam has been happening to Schwab customers for years.
My advice to all of you:
✅Check your accounts every single day
✅Turn on transaction alerts for everything
✅ Paper checks are riskier than ever in 2026 — use Zelle, ACH, apps, or digital payments whenever possible
✅Avoid turning on overdraft protection and linking your brokerage account to a checking account
I did not get this resolved with regular calls to Schwab within 90 days of reporting by the way. It took 70 days before the Fraud department even took on my case in the first place.
I did make a post on Social Media about my experience however, and Schwab contacted me afterwards with a resolution.
It is unfortunate that the way to get a resolution is to shame major financial institutions. But this is not a recipe for a trusting long-term relationship.
I have since moved out most of my family’s accounts out of Schwab. There are brokerage promotions out there that are paying me to switch over. I guess new business is viewed more favorably than existing relationships. Go figure.
You may think that this doesn’t apply to you, because you do not use checks. However, if you have an active bank account, a fraudster with your account number and ACH routing number can print a check and present it for payment. If there are money in that account, it will be drained (especially if under $1,000, as it seems like there are less checks and balances on those). If you have no funds in that account however, that doesn’t mean you can’t lose more and check won’t go through.
If that account is linked to overdraft to a margin account of that broker, the fraudster may be able to inadvertently drain your brokerage account.
There are a few other stories, luckily not mine, from investors who became a victim of fraud.
Fake Options Trades Fraud
A couple lost $180,000 in their Tastytrade retirement account after it was hacked.
The hackers made several losing options trades in a manner of minutes.
The hackers traded thinly traded options contracts.
The angle is that hackers were on the other side of those trades in another account.
Tastytrade reimbursed the couple for half their losses, and blamed them for not using 2 factor authentication.
This is absolutely infuriating. The broker could’ve worked with the exchange and the broker on the other side to bust the trades (cancelled them).
You need to be careful in protecting and monitoring your accounts. I would try to disable options trading on most of my accounts (in addition to margin)
Sources:
https://www.cbsnews.com/chicago/news/couple-retirement-account-hacked-tali-erez-hartal-tastytrade/
https://www.reddit.com/r/tastytrade/comments/1ktdyir/tastytrade_hacked_account_26k_in_less_than_6_min/
ACAT Fraud
ACAT fraud is on the rise.
This is where a fraudster can open an account at another broker in your name.
Then request that stocks are transferred over from your broker to the new one.
Then they sell the assets, and cash out.
This is possible as there are few actual human checks with ACAT transfers from outgoing and income brokers.
This could take a ton of time to resolve in your favor as well.
Fidelity was the only broker that allows you to place an ACAT transfer lock on your accounts. This prevents assets from being transferred from your account.
Vanguard has recently unveiled an ACAT transfer lock as well.
Others like Schwab offer a temporary lock. But many do not have it.
A second line of defense is enabling alerts to notify you of transfers.
Check the article linked below:
https://www.nytimes.com/2025/10/03/your-money/ira-vanguard-merrill-acats-fraud.html