Discussion in 'Retail Brokers' started by nitro, Mar 17, 2008.
I went to Account Admin and put in a request for a withdrawl of 25K, just to see what would happen. I finished it and immediately, my email alert went off and there was this email in my inbox. I figured it was an automailer that they set up today for anyone who requested a withdrawl.
They must be getting a lot of withdrawl requests today.
Obviously no account is 100% safe in this environment but I'm sure IB is easily safer than any other broker out there and possibly as safe as some banks.
I should probably know a bit more about which type of losses would not be covered up here in Canada by CIPF protection. Someone pointed out that if the bank holding IB's money fails, then we would not be covered. Not sure if that's true or not.
Pretty wild that all these conversations are even happening. Interesting times.
RefcoFX also assured its clients - including me - that their funds were safe as they went bankrupt. It is in IB's best interest to calm its clients in a similar way to avoid mass withdraws.
Interactive Brokers appears to be using the same play book RefcoFX used.
I agree that a statement like this means nothing.
However, I disagree that there's a correlation between RefcoFx's actions and those of IB. It is not true that since IB released a similar statement, IB is in similar trouble, or 'taking a page from RefcoFX's playbook', which would imply similar field position, time remaining, etc.
There are several scenarios in which IB's situation is nothing like RefcoFX's, but they issue this similar statement. Hopefully for IB customers, it's one of them that precipitated this release.
I just hope I don't get hit by lightning twice, RefcoFX and then now IB.
Securities Account Protection
Customer securities accounts at Interactive Brokers are protected up to $30 million (including up to $1 million for cash). The market value of your stocks, options, warrants, debt, and cash -- denominated in all currencies -- is covered by this insurance. Futures, options on futures, and single stock futures are not covered, but available cash will be swept from your futures account to your securities account periodically to take advantage of insurance coverage as much as possible. As with all securities firms, this insurance provides protection against failure of a broker-dealer, not against loss of market value of securities.
This protection is provided by the Securities Investor Protection Corporation (SIPC) and Lloydâs of London insurers. SIPC provides the first $500,000 per customer (including up to $100,000 for cash). For customers who have received the full SIPC protection, the Lloydâs policy provides up to an additional $29.5 million (including $900,000 for cash), subject to an aggregate limit of $150 million.
For the purpose of determining a customer account, accounts with like names and titles (e.g. Individual/John Smith and Individual/John Smith) are combined, but accounts with different titles are not (e.g. Individual/John Smith and IRA/John Smith).
SIPC is a non-profit, membership corporation funded by broker-dealers that are members of SIPC. For more information about SIPC and answers to frequently asked questions (such as how SIPC works, what is protected, how to file a claim, etc.), please refer to the following websites:
or contact SIPC at:
Securities Investor Protection Corporation
805 15th Street, N.W. - Suite 800
Washington, D.C. 20005-2215
Telephone: (202) 371-8300
Facsimile: (202) 371-6728
Man to man bet, you fold before they do.
Could someone let me know whether or not CitiBank is the bank that holds IB funds...
If not true then who... If it is true then wouldn't we need to watch CitiBank to watch our funds...
IB customer service has gone down. I called them all day and couldn't get through. I was kept waiting on the phone until I hung up myself. It seems IB is in some kind of trouble.
I was a little worried as well, so yesterday I submitted a withdrawl request on the order of mid 6 figures, just so that I could have some cash at hand should IB run into trouble. As of this morning it looks like it went through (i.e., the funds are deducted from my IB balance and appear as "pending" in my bank account, which I would assume is as good as there).
I called IB funds and banking yesterday and I was told that there phone banks were getting deluged with calls from worried customers. That's what precipitated that mass email that went out yesterday afternoon.
As far as drawing parallels with Refco, I think that's unfair. Refco was outright fraud by the CEO creating shell companies a la Enron. With respect to IB, I'll bet that after the Bear Stearns debacle every single broker out there was sending out emails to its customers reassuring them of the stability of its business.
Still, I couldn't help but make a withdrawl.
Separate names with a comma.