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"IB returns interest income to customers after the first 0.5% and does not depend on the float. "A broker should be able to provide their services in exchange for a commission," Peterffy says." http://www.futuresmag.com/Issues/2011/December-2011/Pages/Top-50-Brokers-This-one-is-on-us.aspx?page=3

Ok so there's some choice. I guess you just have to take a overall view in terms of what a firm offers security wise.

Must be one of few. Just checked Optionsexpress/Openecry, Mbtrading, all have same provision.

Just checked both Rosenthal Collins and R J O O'brian. Both have the same provision for re-hypothecation. So it's a cluster fuck.

IBKR does/did yes. Maybe they weren't aware of MFG's Hyper-Hypothecation.

On re-hypothecation: http://seekingalpha.com/article/311129-the-great-unwind-is-good-for-us

The best thing about IB is Thomas Peterffy's large shareholding.

Def is in Hong Kong isn't he? I'm sure he will respond today.

IB's customer agreement does allow re-hypothecation as well as hypothecation: Interactive or its Affiliates may deposit collateral, securities and/or other Customer property with third parties and may pledge, re-pledge, hypothecate or re-hypothecate Customer collateral, securities and/or...

Thanks for providing clarity Def. On a sidenote if you ever know IB is about to go under can you kindly give us here at Elitetrader a heads up. Cheers.

http://www.nypost.com/p/news/business/exclusive_fifth_house_hearing_thursday_fnyYVnzW0F2i3LL6MqEhGN

This is making me feed sick in the stomach the more I think about it.

Aren't you concerned about hyper-hypothecating? http://www.elitetrader.com/vb/showthread.php?threadid=232268

If it is legitimate it shouldn't be mysterious. It should be transparent. Surely it can be detected somewhere in the financial statements.

Do the new CFTC rules address this by any chance?

If IB are "Hyper-Hypothecating" money to Timberland, that just blows my mind.

Wonderful

Why do IB need a hyper hypothecate provision in their customer agreement then?

Zerohedge will love this story.

Yes they do: https://www.interactivebrokers.com/Universal/servlet/Registration_v2.formSampleView?doc=showFullyDisclosedClearingAgreement.jsp And to think I looked up to IB. Fucken assholes. Is anything safe anymore?