'Even after our mistake, we had done exactly what he asked': Man demands his funds be transferred after $500k+ stock market loss, ignores advisor's warnings and loses more money

Author image for Isabella Penn
Isabella Penn
Mar 14, 2024 12:00 PM EDT

This story takes place during the 2008 financial crisis, but it's still a good lesson, nonetheless. And with today's volatile market, it's worth taking some notes from this man who lost over $500k+, partially due to his representative's mistake and partially due to his own ignorance.

To set the scene, it's 2008, and everyone is envisioning doomsday scenarios regarding their investments, and news reports on the market were causing a lot of poor financial decisions. This man wanted his money from his retirement account to be moved to a more stable market. Well, his rep misunderstood him and only placed his new contributions into a stable fund instead of moving all of his money. Well, after losing thousands of dollars in funds, he had a pretty good reason to be irate. Honestly, he shouldn't be blamed for not wanting to listen to another rep from the same company. But unfortunately, if he had listened and kept his money in place, he would have reaped the benefits of the enormous market rebound. Instead, he pulled everything out and faced even further financial burdens.

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  • 01
    Posted by u/FunkySplash Monkey 2 days ago Demand that your money be moved? Don't let me tell you that this is a bad idea? Sure.
    via u/FunkySplashMonkey
  • 02
    Some of you might recall that financial crisis that happened a bit back, circa 2008-ish. At the time, I was working in a call center for retirement accounts such as 401k's or 403b's. For any non-
    via u/FunkySplashMonkey
  • 03
    Americans, these are plans from your employer where you can contribute a portion of your salary, and usually they will also contribute something as well, to save for retirement.
    via u/FunkySplashMonkey
  • 04
    This is probably the biggest way that Americans save for the end. As the account- holder, you have control over how the money is invested. Usually from a small selection of different mutual funds.
    via u/FunkySplashMonkey
  • 05
    Also, about the call center... I had some experience, I knew what I was talking about and was able to speak with confidence in my voice. Therefor, I was on the "escalated" line. This is
    via u/FunkySplashMonkey
  • 06
    reserved for the people who "want to talk to a manager." I was not a manager, but I and others like me got these calls. In some rare cases, we actually fixed a problem, but more often than not, just told the customer the same thing they
    via u/FunkySplashMonkey
  • 07
    had just heard from the first rep, only with that level of confidence. Then they hung up as a happy customer. We also had the ability to review previous calls to the center.
    via u/FunkySplashMonkey
  • 08
    So, one day in April of 2009, an irate client was transferred to me. He had just gotten his quarterly financial statement, showing that he was invested in several different funds that were affected by the stock market. His complaint was
    via u/FunkySplashMonkey
  • 09
    that he had called a month earlier to request that his stock-market based investments be moved to something more stable and less risky (at that time, the news was all doom-and- gloom, leading people to
    via u/FunkySplashMonkey
  • 10
    make majorly ill-informed financial decisions). This didn't happen. As I reviewed the transaction history on his account, I confirmed that whoever he had spoken to previously had only redirected
    via u/FunkySplashMonkey
  • 11
    new contributions into stable funds, but had made no change to any existing balance. I told the gentleman that I could review the call, and if our rep had made a mistake, adhere to his wishes. I then
    via u/FunkySplashMonkey
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    tried to say something else... but was quickly cut-off. "Yes, review that call. I want my money out of the market!!!" I try to say something like "okay, but sir...." only to be cut-off again. This was not a man with
    via u/FunkySplashMonkey
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    a small account balance, at the time it was 500k+, meaning that at the beginning of the crisis, he probably had around 1 mil in his account. I reviewed the call. And yes, our rep had made a mistake. I
    via u/FunkySplashMonkey
  • 14
    went through the process to retroactively conduct his requested transactions. The rep got a negative mark on his record for making a mistake, but the customer really got the short end.
    via u/FunkySplashMonkey
  • 15
    For those that don't know, the low-point in the market was in early March of that year. Many stocks and markets rebounded enormously and very quickly. What I wanted to tell the guy was something like "fund A is up 28% since the day you
    via u/FunkySplashMonkey
  • 16
    made that call. Fund B is up 32%.... " and so on. But, as he didn't give me the chance to tell him to think about his request... well, that is why I am posting here. As my company had to backdate his transactions, he instantly lost
    via u/FunkySplashMonkey
  • 17
    about 150K in his account, and missed out on the boom. Of course, he called later to complain. But, even after our mistake, we had done exactly as he had asked. I hope he is enjoying his retirement.
    via u/FunkySplashMonkey
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    10
    via Anna Nekrashevich

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crisis call center manager malicious compliance Stock Market 401k financial invest reddit thread retirement Reddit money
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