Law firm for securities account transfer

Custody account transfer: legal classification and options for action

CDR Legal provides you with competent support for your securities account transfer and ensures that you do not experience any unpleasant surprises in a free initial consultation. Such a change of custody account can make sense for various reasons, for example because you are dissatisfied with the conditions of your current bank or because you have found better offers with another broker. However, the change often leads to legal issues, for example with regard to liability, duties of care or possible deadlines and fees. Thanks to sound advice from experienced specialist lawyers, you can maintain an overview and protect your financial interests.

In practice, there is often uncertainty as to how long the transfer may actually take, what costs are permissible at all and under what circumstances the custodian bank is liable. Legal bases such as the Securities Trading Act or relevant contractual provisions regulate many of these points, but are often only used incompletely by investors. Investors may be entitled to compensation, particularly in cases of gross negligence on the part of the bank. Competent legal support puts you in a position to secure and enforce such claims in a targeted manner.

A securities account transfer usually requires that your new bank submits the corresponding application to your previous bank. This process sounds simple, but in practice it can be a source of errors. This sometimes leads to delays that cost investors dearly. If, in such a situation, falling prices are met with a lack of access to your own securities, this can cause considerable financial disadvantages. However, contracts and terms and conditions usually contain clear clauses that specify deadlines within which a change of custody account must be made.

Legal basis and liability issues

When transferring securities accounts, much is based on the provisions of contract law and securities trading law. Aspects of liability and due diligence play a central role. If a bank does not fulfill its duty of care and works in a grossly negligent or even intentional manner, there is a risk of claims for damages. However, proving such breaches of duty regularly involves considerable effort. It is therefore advisable to have the entire communication and documentation checked by a lawyer.

In this context, you can refer to the relevant provisions of the German Securities Trading Act, which, for example, define obligations in securities transactions in more detail. The transparency of costs also plays a major role. If banks charge arbitrarily high fees for a custody account transfer, you should check whether these fees are legally tenable. According to BaFin’s instructions, the cost structure must be clearly and unambiguously communicated to consumers. If the bank does not comply with these requirements, it may be in breach of contractual or statutory provisions.

Practical recommendations for action

To ensure that your custody account transfer runs smoothly and that you are legally protected, you should follow a few basic steps:

• Get an overview by checking the conditions of the target provider. The Stiftung Warentest guide, where you can find tips on fee structures, provides information on this.
• Study your existing custody account contract and any additional agreements carefully to identify hidden costs or deadlines.
• Document every contact and every step in detail if the process takes an unexpectedly long time.
• Pay attention to tax aspects, determined for example by regulations such as the statutory provisions on financial supervision, as these can also influence the settlement.
• Find out about your rights: According to information from the consumer advice center, there is no general legal deadline for transferring a custody account, but banks are not allowed to delay the process unreasonably.

As a rule, the two banks or brokers communicate with each other about the securities account move. It is often sufficient to fill in the relevant form at the new bank, which will then take care of everything else. However, if difficulties arise, such as applications being refused or processed slowly, you should act immediately. At this point, legal advice makes a significant contribution to avoiding possible wrong decisions and securing possible claims.

Practical examples

Even if many portfolio transfers run smoothly, there are always cases in advisory practice where conflicts arise or investors are unsettled:

• Unexpected fees: Some banks charge high amounts for moving securities. This can add up, especially with exotic securities or funds.
• Delays in transfer: Investors often report that they are unable to access their securities for several weeks or even months. In the absence of precise agreements on dates, there is an information vacuum that influences any price gains or losses.
• Communication problems: It is not uncommon for customers to “go round in circles” with both the old and the new bank. Each refers to the other without any speedy processing.
• Liability issues: In the event of gross negligence, it is possible to claim damages. Whether this is successful, however, depends on the specific evidence.

To avoid such scenarios, you should make sure that all important documents are available at an early stage. It is also advisable to set clearly defined deadlines and insist on written communication. If the bank does not respond or the process is delayed, a registered letter or a letter of demand from a lawyer can generate the necessary pressure. As the consumer advice center points out, it is crucial to document all correspondence in order to be able to provide concrete evidence in the event of a dispute.

How CDR Legal can help you

CDR Legal will provide you with an individual review of your securities account transfer and a clear recommendation on how to proceed – free of charge in the initial consultation. Your legal support: with empathy, expertise and transparency. We only take on cases with a realistic chance of success and guarantee full cost transparency before every service. The collaboration starts with a free initial assessment within two working days. We will analyze your situation, discuss the next steps and provide you with transparent information about any costs. We then submit a free request to your legal expenses insurance company. With CDR Legal you are personally and competently represented.

Simply fill out the following contact form and we will get back to you promptly for an initial consultation.