[IB] Freezing your account for their benefit

Discussion in 'Retail Brokers' started by MidKnight, Sep 14, 2007.

  1. I've been having some terrible experiences with transferring my funds out of Interactive Brokers so I thought I would document it here to make others aware of how a broker can effectively steal your money.

    About 1 month ago I decided that I was going to transfer funds out of my IB account to another broker specifically just for FOREX. 3 weeks ago I started the process by creating a wire instruction. The fields IB requires on their new wire instruction web form were called different names then the fields used by the broker I was intending to receive the wire so I was a little confused with what data was to go in which field. Because of this, I made a couple of mistakes and went in to modify the newly created wire instruction a couple times before I got it setup correctly.

    IB have a very poorly thought out security policy that when you modify a wire instruction it ends up 'freezing' your account. There is no way to know from the account admin website that the account is frozen. Everything looks normal. Why is this a very poorly thought out policy? For several reasons:
    - Why would a hacker be more likely to make a mistake on a wire instruction then I would?
    - Due to the MLA Act, one cannot send funds to a bank that isn't in the name of the IB account entity, so what good does it to do for a hacker to alter the bank details to an account of their choice? None, because the funds can only be sent to an account in the same name as the entity.
    - IB service rep tells me that they don't let you know the account is frozen because they don't want to alert hackers, but this also doesn't alert the user that they have been hacked and they remain blissfully ignorant.

    Bottom line, really really dumb idea that isn't thought out at all.
  2. After checking my wire instruction about 1 week after creation, it was still sitting there in the withdrawal funds status as 'processing'. Now I was starting to wonder what was going on. I contacted IB service rep in the USA trading hours (I live in New Zealand so that means I have to stay up till 1 am) and chatted with a guy called Emmett P. He assured me that he would contact the compliance department and and get this unfrozen immediately. He said probably not today, but definitely by tomorrow (Thursday). The tomorrow date he assured me this would be done by was 1 week ago today.
  3. When I checked my account admin on Monday next week, the funds still looked stuck, but I'll give them Monday to work on it (hopefully). If nothing looked to be changed, I would have to be chasing these guys every night this week to get it resolved. I'll start keeping chatlogs from now on just in case I need to show some proof. I contacted Emmett P on Tuesday and asked why my account was still frozen. He replied saying he was disappointed that the compliance dept didn't unfreeze it yet and he would follow it up today. I remained skeptical and expressed that to him. He said he would definitely get through to compliance today and will email later that day to give me a progress report. I requested to get some email contacts for mgmt and specifically the compliance department. He told me that he could not give those out and would be in deep trouble if he did. I thought that was odd, but didn't push the point. Overall I was satisfied with this response and thought tomorrow when I woke up I would see a response from Emmett saying that the account was unfrozen now.

    I woke up and found no email from Emmett - thanks for the great support Emmett. You are a champion.
  4. Wednesday night I contact IB again. I ask to chat with Emmett P again, but am told he is not in today. So now I have to explain this whole situation again to someone else. I can't remember this guys handle, but his name was Brett. To explain it easiest, I asked him to call me on the phone, which he did. He told me my account was unfrozen!!! So I asked him why my wire instruction was still sitting there in a 'processing' state. He didn't know and said he was going to call Funds & Banking. He transferred me to funds and banking department after about a 15 minute hold. Funds and banking picked up the phone and said hello, but before I could reply, I was disconnected, the guy had hung up on me. Probably dropped a donught on the phone and it hung up. Arggggh!

    So I reconnect to chat, ask to speak to the Brett guy. 'Ray V' of funds and banking puts me through but Brett doesn't answer. Instead James B answers. I ask to speak to the Brett guy. James B isn't interested in transferring me and instead wants to field this himself. I explain the situation yet again, to the 3rd IB rep since this incident has begun. James tells me my account is still frozen - WTF? Brett just early told me it was unfrozen. The amount of conflicting information these guys give is a joke - clearly they have no idea what is going on, and what to do about it. In the meantime your money is locked up with IB, earning them interest, and also charging you fees while you can't earn a dime.

    James tells me he is calling compliance department on the phone right now. I wait on chat with him for almost 1 hour. Again I request some contact information for management so I can start to get some traction here. James doesn't answer my requests, he just ignores them. In fact, James doesn't answer at all, even after me asking questions over an approximate 30 minute duration he doesn't type back anything. I guess he went for a coffee break and left me hanging there -- thanks James, thanks a lot. By now, it's 3am and I'm dead tired. I spent 2 hours with these guys that night and got absolutely nowhere.

    The next day I got an email from James, but all it said was I'll let you know when I find out something. Thanks for nothing James, you are really helpful, great customer service.
  5. thankyou for taking the time to post your interaction, at one point I was thinking of IB, but started running into horror stories similar to yours regarding customer service.

    I really don't care about commissions, customer service will drive me up the wall, I wont open a account with IB till your issue gets resolved.
  6. john12


    the above posters full of shit are a 1- in million case. i've been with ib 6 years and taken at least 200 withdrawels and never 1 problem.there customer service is a little shaky but i've never needed and now that they're public i bet it improves. still one of the best brokers out there
  7. Things may be about to get worse, if their support staff
    starts to melt away.

    A friend wrote me this today:

    "By the way, the [tech support] guy's ready to quit. He
    says he gets hundreds of calls a day, and almost every one
    is about this security dongle thing. People are really mad
    about it, and making noises about closing their accounts".
  8. I love IB. I trade stocks, forex, stock index and commodity futures, stock options and futures options. I trade US, Canadian and UK stocks.

    I have the security login device. While it's a hassle to enter an additional code when logging in, it works well and I never had problems. With this device I guess it makes unauthorized access impossible so it's well worth the extra 5 seconds to generate a PIN code once a day.

    Everything works great. In all my years with IB whenever I needed customer support I use their Swiss office and they were very helpful and competent.

    I never had any tech problems so I never ever had to contact their tech department.
  9. Thursday comes around and no response from IB at all. I'll keep this thread updated on a regular basis as a documentation of how these brokers steal your money. I haven't been able to have any trading income for 3 weeks now. And yes, IB still charge you fees while they have your account frozen in this unusable state. I wonder how those guys in compliance department would like it to not receive a pay check for 3 weeks or longer.

    IB's customer service is 100% effective at shielding the company from customer requests and 0% effective in actually helping a customer with something other then, simple day to day customer queries. I've made zero progress on getting this resolved in the 1.5 weeks since I initiated communication with IB.

    Why is it my responsibility to keep following this up?
    What right does IB have to steal my money?
    Why is IB deliberately trying to impede my resolve on this issue? I have asked several times for contact details of management.

    I'm gobbsmacked to say the least. I've used IB for the past 2.5 years and have had no serious complaints until now. I've regularly supported IB on this forum as a first class broker. They are top notch in terms of markets offered, and costs. The sort of behavior outlined in my posts on this thread are completely unacceptable and intolerable of a 'professional' brokerage.
  10. Guys, can we please refrain from using this thread as an IB is good, or IB is bad thread. Those are all over the place here on ET. I'm merely documenting this negative experience so others can be more aware of what they are getting into.

    With regards to john12's comments. How dare you say these posts are full of shit. IB automatically freezes your account when you do as I described above. It isn't some weird fluke. It's a piece of code that will consistently execute when its conditions are met.

    I have very real financial obligations to meet which are being tested because of this major fk up IB. This is not some full of shit joke as you play it off to be.
    #10     Sep 14, 2007