I had the most dissappoointing IB Customer Service experience of my entire investing/trading career this morning. I called requesting the name of the person in charge of trading policies in hopes of discussing IB's policy of requiring settlement of any IRA (cash account) transaction before another transaction is initiated. The operator did not initially identify himself, but when asked at the begginning of the call, he said his name was Joe. I asked Joe who @ IB was responsible for Trading Policies and he spent a good bit of time giving me a non answer by saying he did not know who set trading policies. After confiming the non-answer I asked to speak with his supervisor in hopes the supervisor could advise, but Joe told me I had to send an email in. When I pressed for the supervisor, Joe became very defensive and raised his voice telling me to "send the email". A few more intense exchanges and Joe made the final statement "Send the Email and Live with it!" and hung up. Poor Joe must be under strict orders not to reveal the identity of anyone in the firm (and probably including his own as he refused to give me his full name) IB is obviously the Costco of brokers and intends to compete on price/performance and not on overall value to anyone other than the most independent of traders and personalities. This is not a bad thing, but if I had know 2 months ago before I brought my Investment Advisor accounts to IB in order to reduce operating costs to my customers.... So I guess you live with it or move on.
DON'T YOU KNOW THAT MANY OF THEIR CUSTOMER SERVICES STAFF USED TO WORK FOR THE NY/NJ STATE MOTOR VEHICLES DEPT. THEY BRING THEIR EXPERT SNOB TO THE JOBS.
The IB phone reps are in general rude people. My firms would immediately fire anyone either acting this way towards customers - no matter how difficult they were - or anyone that purposefully planned for this type of customer experience. That being said, you need to take IB for what it is - a bare bones operation. For purely retail customers they have no interest in customer service and expect you never to call them or to disagree with anything they say. In case you dont know, ther rest of the industry is no different. You will only be treated preferenially when you truly generate large dollars for a firm and even then the treatment that you will receive is much less polite and agreeable than in other industries. The personalities of the people in this business are what they are and you just need to deal with it ....
bent, if you really run IA accounts and are a trading professional, you would have realized that you cannot margin in an IRA. You definitely have to wait for settlement or else you would be effectively receiveing a loan from the broker to purchase stocks. As a trading professional (if you are one) who supposedly has some understanding of the industry, you would realize this policy is more properly discussed with the IB compliance dept. and not customer service which deals with order status, accounts, TWS etc...
Thanks to every one. I'm aware that IB interperets the reg very conservatively, and that is their right. But the requirement for settlement prior to allowing a new position is not consistent in the industry. Until cash leaves the brokers oversite, we are mearly discussing an accounting issue. As long as the broker can control the flow to honor the intent of the reg, there is no harm. For the brokers who allow new positions prior to the archaic settlement allowances, they are obviously taking on this management responsibily, to enhance value and service to their customers. My frustration is that IB is ideal for placing small position on limited liquidity companies. I was hoping to migrate the IRA accounts I supervise to IB to ease my efforts and pass along the savings, but the settlement policy diminishes the advantages. I'm hoping IB reconsiders this policy. I'm over the insult, and really hope things can work out. There probably are issues and directives I'm not aware of and IB may be just waiting for this issue to shake out with an offical SEC policy statement before they stick their necks out, and I can certainly respect that. And Puffy, if you would brush you teeth regularly and floss, you might not be so grumpy
bent_prop, IB is hardly the only broker to do it. SEC is requiring all brokers to handle cash accounts that way. Ameritrade was the first they went after during the DATEK merger. IB is not "Interpreting" the rule to your disadvantage. They are forced to do it. This issue has been beaten to death on just about every message board. Search for Reg T on Yahoo message board for Ameritrade - you will find 100 posts on the issue. http://www.sec.gov/answers/freeride.htm Here is one Yahoo thread with tons of replies to one guy who just couldn't get it through his head that Ameritrade was not doing something "Unlawful" - the discussion is on the same issue as what you have with IB: http://finance.messages.yahoo.com/b...080736&mid=133586&thr=133586&cur=133586&dir=d
Well, I can see the politics of advantage and disadvantage is alive and thriving. Disadvantage individual investors with draconian regs and more will give up and buy a mutual fund or something the industry can make some real money on. One question I have is since settlement takes 3 days and you take the replacement position after the sale of the initial position.... How is it a loan? Theoretically your cash account is flush with cash prior to the settlement of the new position. If they are cash accounts then do the accounting on a cash basis, not an accrual basis. They should either account when monies are due or when orders are taken. But not charge your account when the order is taken and credit the account when the money is received. It's my oppinion that this is a very unfair policy as it allows brokers to use your money for 3 days without compensation as well as an illogical and unfair accounting relative to current electronic capabilities. (I might have the cash or accrual designations transposed) I'm feeling synical.
It just takes some getting used to. Imagine a whole country where every representative of any company and of course the government has that attitude towards customers. I grew up in Austria, which was just that. For example, when I would go to the post office to get a fresh supply of certain shipping labels, it would usually be like this: You enter the hall and find about a dozen blistering idiots located behind the counter, half of them sleeping, the other half eating, occasionally there would be a couple of them engaging in small talk. So you approach the one who seems most awake and try to somehow get his attention. Usually after about a minute or two and after subserviently asking for an audience a few times, he would give you some sort of growl or burp between bites, then you had to state your request a couple of times until he turned away from you, at which point you could assume that he thought he had understood you. He would then finish his meal and start complaining to one of his colleagues about the strain you were putting on him by asking for whatever you were asking for. Then, very slowly, he would initiate the procedure required to obtain what you had hasked for. In my case, that meant walking to the back of the room and getting the forms. Finally, after a total time of about half an hour, he would throw the forms at you without saying anything or looking directly at you. It was a good idea to thank him, just in case you needed something else for him before his memory had been erased through alcohol abuse. And guess what, this kind of behavior could be experienced not only at the post office, but also at almost every business unless you happened to talk to the owner himself, in which case there was about a 50% chance he would treat you like a fellow human being.
I have worked in Customer Service in the Brokerage Industry and the only way to do, is to happily let the customer talk to a Supervisor. It's silly to sit there and try and prevent someone from talking to a Supervisor, it just prolongs the call, and pisses off the customer. Doesn't matter if the customer will be told the same thing by the Supervisor or if the perception is that the customer is wasting everybody's time. (of course a company or a rep that allows the perception "of don't waste our time" is not going to stay in business very long. Of course the customer service rep, that is trained by me is always told that the customer is NEVER put off and NEVER told he cannot speak to a Supervisor.