my guess is that one or more of the files compiled from the stock lenders has these stocks on the list. IB surely must get the restricted stocks from a reliable source (ie. the fed or the clearing house). The software checks the restricted list and makes sure it follows regT requirements. Thus if a stock name is given to IB from the borrower that is not eligible to be shorted, then the software should disallow it. My next guess is that there was an assumption that the lists provided by the lenders removed such names before delivering them to IB - apparantly not. Next logical step is for me to point this out to the various internal parties who then can write some code to remove restricted names before placing on the web site.
I also did some checking against UPC 11380 and didn't find any stocks on the IB list. I've seen stocks trading under $1 on the short list.
OCA, i couldn't short it, same message. Found out the web site list is updated independently of the list rec'd from the lenders. I sent word out and hopefully it will be rectified ASAP. As for shorting under $5.... For all of those who took the series 7. you may recall that Reg T allows you to short under $5 but the margin requirements increase by some factor as a stock slides below that level. ie. 150% margin etc.