Hence, I advise IBKR customers to avoid using margin on options. ALL the lawsuits against IBKR that involve autoliquidation are related to options. There is always the possibility of bugs in the autoliquidation software. I guess the risk is higher for options.
Customers of Interactive Brokers file class action complaint over management of portfolio margin acc
- Thread starter ajacobson
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Hence, I advise IBKR customers to avoid using margin on options. ALL the lawsuits against IBKR that involve autoliquidation are related to options. There is always the possibility of bugs in the autoliquidation software. I guess the risk is higher for options.
You deserve better. Leave him...he'll keep hurting you
Good point. There was huge lawsuit by a guy who was trading VIX futures. The guy traded size and was liquidated because IB miscalculated the day that futures settled. I'll try and find that article. Losses were also 7 figures IIRC
Found it! https://nypost.com/2015/04/12/incorrect-date-costs-broker-nearly-23m-in-liabilities/
This guy lost 23 mil.
A quote: "When Cerisano figured out what actually happened, he lodged his complaint. Instead of sympathy and recompense, he got the cold shoulder, according to his attorney. “My client has had to pay tens of millions of dollars in commission to Interactive Brokers over the years, so he was surprised that that was the approach, even when they were caught red-handed,” Lieberman told The Post."
This guy lost 23 mil.
A quote: "When Cerisano figured out what actually happened, he lodged his complaint. Instead of sympathy and recompense, he got the cold shoulder, according to his attorney. “My client has had to pay tens of millions of dollars in commission to Interactive Brokers over the years, so he was surprised that that was the approach, even when they were caught red-handed,” Lieberman told The Post."
I did not see anything in the complaints that referenced liquidation.
I only saw references to trader stupidity.
Reasonable guess on my part. But you're right. It isn't explicitly stated.
Sounds like in this case, the fault truly lies with Interactive Brokers. My confidence in this broker is shaken. Sigh ... to play safe in future, stick to plain stocks and less volatile futures contracts when using margin.
A reasonable plan I suppose when dealing with a broker like IB. But what would you do if IB made an error on a stock trade that costs you a small fortune?
I just see a pattern of behavior. I'm sure it is possible to find settlements against other brokerage firms but it's rare to see something this egregious.
This poor gentleman is now a resident of Bergen county jail. He owes about half a mil in child support and will have to pay 51000 a month in alimony for a long time. Imputed income I'm guessing. Google it. I doubt he'll ever recover from this...
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