IB Tracing Ip Address

Discussion in 'Retail Brokers' started by cgjung, Dec 2, 2002.

  1. cgjung


    I have a technical question which I hope some of the more technically astute members of Elite trader will be able to answer.

    Will Interactive Brokers be able to identify your location when you log in and track trades based on your IP Address.

    The reason I ask is of no malicious agenda but rather a complex
    tax related matter governing e-commerce transaction with hedge funds whose transactions are executed domestically but operate
    in a foreign jurisdiction. In Canada for example, an offshore fund
    may have a de facto management team based in the Bahamas but retain an advisory team in Canada. The advisory team executes trades on behalf of the management. There is some ambiguity as to whether a transaction through a Canadian internet service provider may constitute a "carrying of business in Canada" which would subject the fund to local securities and taxation implication. Again this a grey area and no clear lines have been drawn by Revenue Canada.

    My line questioning is proactive,

    If Interative Brokers cannot determine ( which I believe they can)
    then this issue becomes moot. If they can determine your ISP will countermeasure such as Secure Proxy Servers outside of Canada be effective in eliminating IB's trace to a Canadian Server.

    Thank you,

    Any help would be greatly appreciated.
  2. qdz


    Thanks for reminding 'em this. They are good at these matters. Be prepared for that may be the next change to take place. But do not worry if you are talkin about firms. Worry if you are doing this as a small individual investor.


    JMHO, not a complaint. I may not be as helpful as you hope. But many others will give you better comments.
  3. def

    def Interactive Brokers


    I'll preface my statement by noting that I am not a legal expert and that the following is my opinion and not the opinon of the firm (IB):

    Whether we or any other broker could or would is not the issue. The issue is whether or not you are doing anything illegal. If you are planning to set up an illegal structure in an effort to avoid taxes, please reconsider or find another broker. If however, what you are doing is legal, then you shouldn't have any fears. There are many large and noted hedge funds (and even an ET member or two) that have legally set up shop in places like Bermuda to reduce taxes.
  4. Sorry, cgjung, but your post is baloney (at least the mysterious explanation about hedge fund transactions).

    Tax issues always depend on things like your country of permanent residency, but not on the ISP you use to log into your brokerage account.

    If I make a journey to a foreign country and then log into my brokerage or bank account (e.g. from the hotel room or an Internet cafe), nothing changes with respect to my obligation to pay capital gains taxes in my country of permanent residency.

    It appears to me that your real interest is to get information whether IB can trace logins, for example if you fraudulently log into an account which you are not the owner of.

    Yes, actually IB is supposed to store things like IP addresses (as a security measure).
  5. Three charged in massive ID theft
    By Matt Andrejczak, CBS.MarketWatch.com
    Last Update: 7:41 PM ET Nov. 25, 2002

    NEW YORK (CBS.MW) -- Federal authorities charged three men Monday with
    stealing credit information from more than 30,000 people in what is
    being described as the largest identity theft in U.S. history.

    The scam began three years ago when a computer programmer allegedly
    hacked into the network of a major credit bureau service and then sold
    the information, Justice Department and FBI officials said. They
    estimated the initial losses at $2.7 million.

    Charged in the scheme were programmer Philip Cummings, Linus Baptiste
    and Hakeen Mohammed. Cummings and Baptiste were charged with wire
    fraud. Mohammed was charged with mail fraud.

    "With a few keystrokes, these men essentially picked the pockets of
    tens of thousands of Americans, and in the process, took their
    identities, stole their money and swiped their security," said U.S.
    Attorney James Comey.

    Cummings formerly worked at Teledata Communications, a New York-based
    company that provided software and subscriber codes to banks and other
    financial entities to access consumer credit information from three
    major credit bureaus.

    Federal authorities said Cummings was paid $30 for each credit report
    he downloaded and gave to a co-conspirator who is now cooperating with
    the government's investigation.

    The information was then sold to more than 20 unnamed individuals in
    the Bronx and Brooklyn who took money from people's bank accounts and
    made unauthorized credit card charges.

    The biggest casualty of the fraud was the Grand Rapids, Mich. branch of
    Ford Motor Credit Corp., from which approximately 15,000 consumers had
    their credit reports siphoned.

    Other credit reports were obtained from the databases of Washington
    Mutual in St. Augustine, Fla.; Dollar Bank in Cleveland, Ohio; Sarah
    Bush Lincoln Health Center in Ill.; the Personal Finance Company in
    Frankfort, Ind.; the Medical Bureau in Clearwater, Fla.; Vintage
    Apartments in Houston; and Community Bank of Chaska, Minn.

    Over time, Cummings provided passwords and codes to his alleged
    co-conspirators from other credit bureaus such as Equifax and
    TransUnion. He allegedly taught one of them how to access the
    information, according to the government's criminal compliant.

    Matt Andrejczak is a reporter for CBS.MarketWatch.com in Washington.
  6. Tom Frey

    Tom Frey

    lol if one seriously considers fraudulent action he better be not that dumb and ask such stupid questions ,)
    of course they can log the ip and trace up to the dial-up knot.
    But if they actually store the logs you have to ask them. IMHO they do as a matter of security
  7. def,

    While I agree with (and appreciate) the vast majority of your posts, I cannot help but disagree with this one. As you stated, this is your personal opinion, and not that of of your firm (Interactive Brokers). The above statement is very disturbing. I would guess it to be something akin to what the Gestapo told the German civilians as they searched their (the civilians') houses for Jewish people. Perhaps this is a bit of an oversimplification on my part, but, I am sure you get the point.

    This is not meant to be a personal criticism or personal attack. I just wanted to raise my objection to the statement quoted above. Thank you for reading and have a good day.
  8. THEY are watching you, hardrock:eek::D
  9. qdz


    Feel the same. That is very disturbing.


  10. cgjung


    Again I want to reiterate my position has no malicious agenda but rather to develop a fund infrastructure that is sound and well positioned proactively to head off any future policy changes regarding the taxation here in Canada.

    I think many of you who reside in the U.S take for granted how well conducive it is to set up an offshore fund and manage it in the U.S. However, in Canada our rules are restrictive and at times quite frankly stupid. We have extremely poor legislation governing hedge funds, since its legislation is only reserved for the institutional banks to preserve their position of power.

    Example. Soros's fund is based in Netherlands, nominee directors and the whole board of directors reside outside of the U.S. Soros fund management is the principal advisor to the fund exercising all trading and advisory control. That would not be allowed here in Canada.

    For one thing Soros is not a licensed CFA. In Canada if your are not a licensed portfolio manager forget about managing money.

    Further more, the idea of all trades transacted through a Canadian server MAY raise objections by Revenue Canada as to the degree of "carrying a business" in Canada. Regardless as to the surface of the residency of board of directors and the incorporation of the company. Central mind and management test
    by Rev Canada may construe exercising trades through a Canadian Server as an establishment in Canada and advisory execution of trades may be deemed to be principal management functions hence a Canadian Business. In law, it is frequently referred to as Substance over Form.

    If IB cannot trace your IP address or if you use a Secure Proxy Server you are not treading in any illegal grounds but rather you are allowing yourself to avoid Revenue Canada exercising a precedent over the issue if they decide to change policies governing e-commerce legislation.

    And my question are not load of baloney, if you care to review http://www.ccra-adrc.gc.ca/ecomm/ this will give
    you more insight into the unresolved matter.

    Before the internet, managers overseas would get a phone call from their advisors to execute a particular trade. The offshore
    manager would okay the trade either by executing it himself or sign an authorization and faxed to the advisor to be executed in Canada. With the net and active trading, the advisor is now able to remove 2 steps. It is impractical to follow the traditional phone routine if you intend to intraday trade. Some large law firm here in Canada has advised to have the server in Canada
    routed to an offshore server them to IB. To setup a server offseas may be cost prohibitive.

    If anyone has any sugesstions it would be greatly appreciated. Any ideas on Secure Proxy Servers.
    #10     Dec 2, 2002