Well, would you believe it!

EnglishMohican

I have an account with X-O with various ETFs in. Recently, a dividend came in from my Vanguard Developed Europe ex UK ETF which is denominated in euros. X-O's bank converted it to £s and it was paid into my X-O account. So far so good and that is what has happened on all other dividends on all other ETFs. (VERX is new to me - so first dividend.)

On this occasion, a few days later a Bank Fee popped up on my account. When questioned, X-O told me that this was charged because the Registrar (for that ETF) used a cheque to pay the dividend and that the bank makes a charge for cheques (but not for BACs or whatever is the normal thing). X-O merely pass the charge along.

Now we are not talking about much money, the fee was £5 but I would like to be sure I am not being told a porky and that the bank is not taking liberties (NO, I hear you cry, a bank would not do that.)
Do you believe that Vanguard use a number of different Registrars (for UK/Ireland based funds) and that one of them might use a cheque to pay dividends? Is that credible in this day and age?

I would ask Vanguard but I would like to be more sure of the possible answers before I ask.

westy22

Even if Vanguard did send a cheque I would presume that it was a large cheque to Jarvis covering the entire dividend liability for all the shares that they hold as nominee. It is then Jarvis's job to carve that money up into little bits to credit to individual shareholders' accounts.

We are quite a small firm and we are only charged 75p to pay a cheque into our Barclays account no matter how large the cheque is. I can't believe that Jarvis can't bank a cheque into a major bank cheaper than we can.