<<< if their risk management team doesn't catch it.. and the option gets assigned... its on them to make up the difference for the money that you don't have in your account to cover the stock.. thats just not going to happen... this all fa >>>lls back into broker risk....>>> Yes, they will be responsible for the money at that time. But then they will come after you to make up the difference, once the immediate crisis is contained. Whether or not they sue you will depend on your assets. If you have a job, and they win the case, they will garnish a % of your wages per paycheck. If you stated your account is "speculative", vs "conservative", when you filled out the forms, you will be responsible. If you said it was to be a conservative account, but they allowed you to speculate, then it was their fault.
The danger you are in is remote. Extremely unlikely to occur. It's more of a "what if" type issue. That being, "what if" there was a sudden and severe market event on option exp day,.... and "what if" the firm didn't get around to closing your trade for you,... and "what if" you could not afford to buy the shares put to you,.... and "what if" the shares dropped even further monday morning before you could sell them,..... Extremely remote.... but what if?
PM, I thank you for that comment.... Some of us work hard to place and maintain our trades (even credit spreads) where we will not experience significant losses... this may require closing early at a loss. I place my spreads very carefully and monitor them and the overall market very closely. I have plans for making necessary charges when certain price points are hit.... I am sure there will be the time when I will have to take a loss on a spread trade... knock on wood, it hasn't happened yet. I do understand the risks and manage those risks.