Interactive brokers outage

Discussion in 'Retail Brokers' started by redharel, Jan 5, 2018.

  1. I have also lodged a formal complaint and compensation claim. I used to work as a Trustee with oversight of various fund managers. It's normaly a legal requirement for the party that causes loss to the fund to compensate the fund by the same amount. So if the broker causes a loss, and the FM had no control, then ultimately the broker would compensate, but often the process would be drawn out as you can imagine. More often than not, it's the FM that screw up and have to compensate, but again they will drag their heels and often do deals with the service providers, who sometimes make payments to keep the FM 'happy' and on their books, which of course is a conflict of interest and not meant to happen.

    I see some people have pointed out there are numerous get out clauses in the agreement. These are probably not going to help IB in court, but will certainly help to slow things down significantly, which is of course their purpose to deter people from making a formal compensation claim.
    I expect in my case they will argue any losses are specualtive.

    In my case, they sent a rather amusing response when I asked them to immediately bust a trade that I couldn't cancel as had no access (on any level including phone). They said the exchange wouldn't accept the bust request and then they told me I should mange my risk appropriately when trading. You can imagine the response they got to that wisdom. I fully expect to take this to the UK regulator to get any fair compensation, and that's what I will be doing. Just opened an Etoro account as a back up untill I determine which broker is appropriate. As many have noted, the way IB handled this is a compensation claim in its self. I have requested detailed logs from IB as back up to support my claims. They have not provided these yet. I took various screen shots during the outage. If anyone needs these as backup, send me message.
     
    #71     Jan 13, 2021
  2. Cabin111

    Cabin111

    In your application with IB, you said you had many years of experience at level 2 and maybe level 3 trading options (unless you lied). That will be the first thing they bring to a judge or an arbitrator...Now where do you stand??
     
    #72     Jan 13, 2021
  3. I have a different problem today with IB. Just logged on and suddenly I have a margin account with a significant maintenance margin and for my standards massive buying power. can someone explain to me what happened?
     
    #73     Jan 13, 2021
  4. Cabin111

    Cabin111

    Never get into a land war in Asia!! Never leave open positions uncovered...

    Are you waiting for trades to clear (2 business days)...

    upload_2021-1-13_12-2-49.jpeg
     
    #74     Jan 13, 2021
    unconventional wisdom likes this.
  5. love the princess bride reference! classic! i'm thinking it's maybe due to the transfer from UK to Ireland (brexit). I've deliberately avoided margin accounts! i don't want that much powder to play with
     
    #75     Jan 13, 2021
  6. def

    def Sponsor

    I can't comment w/o any specifics on the account but note with a margin account you do not have to use margin nor get charged for having margin capability. One advantage of a margin account is free-riding (not having to wait till settlement) to use available cash. there are also benefits with FX (ie you can buy stocks in currencies you do not hold either on margin (borrow the foreign currency) or not have to wait T+2 for funds to settle before using them after an FX conversion.

    In short, if you are disciplined you'll never have to utilize a margin loan.
     
    #76     Jan 13, 2021
  7. I don't think that's a reason they could use to undermine a compensation request, in this context. We are not talking about a product blowing up that may have caused significant losses to people who did not understand products, despite stating they did, and I'd agree that in that context, that would be that. The complaint is about no access and not being able to manage risk and losses because of this. Not sure about the US, but in the UK, you lodge a complaint and the regulator considers available evidence and arguments to decide what’s fair and reasonable, but only with regards to the complaint lodged. The IB outage was a well documented service failure. Flagging how rubbish IB internal compliance is to the regulator, to avoid paying compensation for a major outage...that could get expensive. If I were the CEO I'd be putting the compensation claims to bed quickly to avoid further regulatory scrutiny.
     
    #77     Jan 19, 2021