Scotia iTrade WARNING: Misleading customers on USD conversion when buying US equities

Hello,

I would like to bring to your attention something that I believe is a VERY unfair business practice by itrade, enough so I will be leaving them as a result. I recently made a US equity purchase (please see screen shot).

Just before you place your equity order you get an estimate on the "FX rate". You can clearly see a estimate rate of 1.0205, which I thought was fine, the spot rate was ~1.015. To my disgust once the trade cleared the next day the actual settlement price was way off, a whole $100 off. When I did the calculation the "FX rate" was actually ~1.04 (a whole 100% off of itrade's own estimate). I immediately called and was told that the website was only an "estimate", hello???? 100% wrong estimate??? I hope you would agree with me that this is unacceptable. I pressed them some more to show me the exchange rate and fee for currency conversions. They told me flat out that "we do not have to disclose the rate", and they don't!! Hum what could they be hiding?

You have to ask yourself why you would do business with a company that:
1) doesn't disclose its currency conversion fees
2) has a website that gives a misleading (100%) quote. I can only surmise that they are betting that people will overlook the discrepancy, very shady. I tried the quote everyday since and its always the same wrong quote. I mean how hard is it to give a more accurate picture? I suspect it's because of the next point...
3) Their conversion fee is ~2.5% (credit cards do the same). I called around and the competition is ~1.7%.


This whole experience left a very bad taste and I will be leaving as a result, the biggest of betrayal is the misleading website. I caution anyone doing a US equity trades to be aware of their practices, the costs can add up fast. This is one of the shadiest business practices I have come across in a long time and felt compelled to make the community aware.

That's why I keep two separate trading accounts. One for CAD, and one for USD. No need for conversion unless I really need the money.  For what it's worth, although I sympathize with you in your rant against unfair exchange rates, my opinion is that you're way overreacting. This type of estimated conversion rate happens all the time. With RBC DI for instance, I never get an "exact" conversion before a transaction--it's always an estimate. Currency rates fluctuate.

I was curious, so I looked it up. What parts of this fee statement from them are troubling to you? Their disclosure statement explains quite clearly why their estimate might be wrong. If your answer is "but it was REALLY wrong," that's because currency exchange rates can change quite dramatically over short periods of time.

https://www.scotiaitrade.com/helpcentre/lcmmmbi3.shtml