Big Bug at Schwab during transition: "Restriction placed on your trading"

[earth_imperator]

Big Bug at Schwab during transition: "Restriction placed on your trading"

The brokerage firm Charles Schwab that now owns TD Ameritrade
has recently sent out some erronous emails to some TD Ameritrade clients.
TD Ameritrade has apologized for the error and said to ignore these emails from Schwab.

email by Schwab:
"
We had to restrict your trading after a recent issue
The trade(s) you placed on XX/XX/2023 was not settled in accordance with securities industry regulations.
In cases like this, regulations require that we restrict your trading for the next 90 days just to the funds available in your account. In cases where there's a history of settlement violations, this restriction will not expire.
...
"

It's wrong, as there was no violation at all of any use of unsettled cash.

email from TD Ameritrade:
"
Please disregard any account restriction emails from Schwab

Dear XXXXXXXX,
You may have received an email(s) from Charles Schwab & Co., Inc. ("Schwab") regarding a trading restriction on your account. We are working behind the scenes to prepare for your transition to Schwab. This message was sent in error following some of that work.
For now, there is nothing for you to do.
...
"

 

[BMK]

Why am I not surprised?

With any merger of two organizations of that size, there will be problems. They are probably thanking their lucky stars that the accounts in question were not actually restricted. That would have generated all kinds of claims, because it would have actually prevented clients from placing orders.

 

[VicBee]

Big Bug at Schwab during transition: "Restriction placed on your trading"

The brokerage firm Charles Schwab that now owns TD Ameritrade
has recently sent out some erronous emails to some TD Ameritrade clients.
TD Ameritrade has apologized for the error and said to ignore these emails from Schwab.

email by Schwab:
"
We had to restrict your trading after a recent issue
The trade(s) you placed on XX/XX/2023 was not settled in accordance with securities industry regulations.
In cases like this, regulations require that we restrict your trading for the next 90 days just to the funds available in your account. In cases where there's a history of settlement violations, this restriction will not expire.
...
"

It's wrong, as there was no violation at all of any use of unsettled cash.

email from TD Ameritrade:
"
Please disregard any account restriction emails from Schwab

Dear XXXXXXXX,
You may have received an email(s) from Charles Schwab & Co., Inc. ("Schwab") regarding a trading restriction on your account. We are working behind the scenes to prepare for your transition to Schwab. This message was sent in error following some of that work.
For now, there is nothing for you to do.
...
"

In your case, not a bug.

 

[countryBoy641]

I have an account at Ameritrade.
My rep (90 miles away) calls me to say hello occasionally,
But I have not received any such notice from Schwab.
My account transitions in September.
That's all.

Another headline looking for a story.

 

[zdreg]

Why am I not surprised?

With any merger of two organizations of that size, there will be problems. They are probably thanking their lucky stars that the accounts in question were not actually restricted. That would have generated all kinds of claims, because it would have actually prevented clients from placing orders.

Your response is too generous.
Headline
Charles Schwab to pay $187 million to settle SEC charges that it misled robo-advisor clients on fees
PUBLISHED MON, JUN 13 20221:40 PM EDTUPDATED MON, JUN 13 20222:17 PM EDT
Maybe if they did not pay this fine they would pay higher salaries to get the best programmers.

 

[mervyn]

Big Bug at Schwab during transition: "Restriction placed on your trading"



email by Schwab:
"
We had to restrict your trading after a recent issue
The trade(s) you placed on XX/XX/2023 was not settled in accordance with securities industry regulations.
In cases like this, regulations require that we restrict your trading for the next 90 days just to the funds available in your account. In cases where there's a history of settlement violations, this restriction will not expire.
...
"

"

Most likely is "good faith' volitation, you exited the position before your previous trade was settled, in cash account.

With margin account, this type of wording is unlikely. It is not a bug.

 

[earth_imperator]

Most likely is "good faith' volitation, you exited the position before your previous trade was settled, in cash account.

With margin account, this type of wording is unlikely. It is not a bug.

Give an example.
I have a minimal unsettled cash and several multiples of it as normal cash available.
So, then no violation is possible, IMO.
And yes, it's a cash account, not margin acct.

If your logic were true, then no daytrading would be possible at all...

The rule of thumb here is: you can spend your whole cash only once per day.
There was no violation of that rule.

Definition:
"A good faith violation occurs when you buy a security and sell it before paying for the initial purchase in full with settled funds. Only cash or the sales proceeds of fully paid for securities qualify as 'settled funds.'"
--> More info at https://www.fidelity.com/learning-center/trading-investing/trading/avoiding-cash-trading-violations

Ie. I always paid in full with settled funds.