Zecco Screws Over the Little Guy Again

I wrote a review about Zecco here about two years ago.  I liked what I saw and opened a small account with them for speculative trades.  I've been with Interactive Brokers since 2001, so it would take a long, long track record to get me to switch.  Plus, IB options commissions could not be beat.  No mind.  Free stock trades isn't something to let go by.  I was also interested to see if 'free' cost money in the way of poor execution.  Much to my surprise, the execution was pretty good, even on odd lots.  There was no shenanigans with the free trades either, they were free.  No account minimums, inactivity fees, etc.  Well, that changed in October 2007 when I wrote this article about Zecco bait and switch.  The fall out to me was pretty spectacular (they were verbally whipped and beaten for weeks after the announcement). To me, this was a sign that their business model of giving things away for free wasn't working (I guess they thought they would make money on volume?).  They raised the zero commission minimum balance to $2,500.  I had more than that in the account, so I actually wasn't affected, but I saw the writing on the wall.  I sold what I wanted to sell and moved all cash back to my IB account where the rules weren't changing so quickly.  I could no longer trust this company.

I don't know when it was enacted, but I signed into Zecco today to take a look at my few remaining open positions and noticed that the new account minimum for zero commission is $25,000.  Quite a leap and I'm certainly not keeping that kind of money with a company like this.  So what have the new commission schedules gotten us little guys? Nothing that I can tell.  It's still a subpar platform with no bells and whistles.  I think the little guys $4.50 funded the forex operations which is a profit machine for most brokers at this point.

So as I suspected, the zero commissions was nothing more than an elaborate marketing scheme.  Hope nobody closed their IB accounts.