Hi Dale, gang,
It's been awhile. I've been having a very good year--not as good as Richard and a couple of others though. Had a disaster with DIR this week that you all should be interested in if you are active traders. BTW Richard did you get your 100$ BNBN cert. for joining me up with DIR? Finally got mine. Real irony there as I'll soon explain.
DIR's system has been having troubles for the past couple of weeks--can't handle all the new business Richard has brought in <<vw ironic g>>. I actually had one of my best weeks of the year last week--down the drain and much more this week due to DIR system breakdowns, lack of disclosure, and excessive phone wait times.
I tried to do an overnight trade on SCON on the AT news Mon. Thought there was a reasonable chance for a multi-day run, and would stay right on top if my guess was wrong. I got in ok, but when I tried to get out pre-market the next AM (It was clear I had guessed wrong), the system wouldn't recognize my position and wouldn't let me sell. Turns out the Pershing MM mainframe had a meltdown and had no record of the previous day's buy even though it showed up in my balances. The following is what I posted on Yahoo just now after I closed my account.
I am posting this as a big "beware" for active traders. You can make the right decisions, but if the system won't execute your orders, you are left with a big exposure on a volatile stock. I am still well ahead of last year and it's not $$$ I cannot afford to lose, but unless there is some consequences for the online brokers for the lack of adequate and timely disclosure, we are all at risk. Thanks in advance for indulging me Dale. I've missed you all.
Jim
PS--Any thoughts out there on OLB's with reliability and timeliness--PLUS timely, adequate disclosure when problems do occur? And, if I have multiple brokers, can I sell out of a position that is in "street name" with one broker, from a different broker if the one which holds the shares has a system failure?
<<Subj: I just closed my account
By: steliejim
Date: 3/16/00 3:59 pm
I had a real--not paper loss of $41,000
due to DIR screwups and lack of
disclosure of the nature of their problems. I
posted here the other day saying that I
would wait to see what DIR would do to
take responsibility for the system not only
being down but also providing misleading
and inaccurate information--as well as not
providing a responsive, timely backup to
their broken system.
I had a nice long talk with a supervisor
yesterday and was almost convinced that it
was my fault that my account was screwed
up and I could not trade out of a ST
position. He said mutiple times that I am a
good customer and DIR does not want to
lose my business.
I actually was going to just try to continue
to work with DIR--he seemed like a nice
earnest fellow--until today when I tried to
sell the position after deciding that it
probably wasn't going anywhere for
awhile.
I was able to sell part of it, but when the
price dropped and I put in a "change"
order for the balance (well below the
"bid"), the new order did not show up in
the "Order Status." I tried again
immediately. The same thing happened.
I immediately called rather than keep
trying--and I held for 45 minutes. Much
better than the 95 minutes Tues--he wrote
sarcastically. BTW the new message takes
much longer than the old to lead you
through the prompts and ironically starts
off with the words, "Our reputation is
online"--the only change I could tell.
I led the rep, then the supervisor, through
what had happened. The stock dropped
another 5 points in the meantime--this time
I sold. The supervisor, called back after
"researching" the problem, called back,
and said "We found nothing wrong with
our system this morning, and unfortunately
we cannot compensate you for the
difference between the time you tried to
sell and the time you reached us."
There was nothing wrong with my system
either and I have the proof that I was in
DIR's system, tried to sell my entire
position and tried to sell the remainder.
Fortunately this is not money that I cannot
afford to be without while I take formal
action. I pity others in less fortunate
positions who had depended on DIR
reliability. Ironically, it almost would be
better if DIR was screwed up more often,
because one would know better than to
trust them.
I had actually posted on the SCH board
over my good success up until recently
with DIR. DIR obviously does not care
about their customers, or their
responsibilites. I'd be willing to bet that
their risk management folk figure that
DIR's reputation, up until recently, and
their advertising--along with a sypathetic
press that gets a lot of their advertising will
outweigh the loss of the customers willing
to put up with the pain of finding and
switching brokers and the potential
monetary damages from the formal action
with the SEC and/or lawyers. reputation.
As I told the supervisor before I hung up, I
am willing and committed to what I can to
make the public aware of the pain (It's
been emotionally draining too), loss, and
risks of trading with DIR.
Consider this the first step.
The online brokers apparently don't feel
they have to bear responsibility or
consequences for breakdowns and
inadequate disclosure. I am going to do my
best to change that. In the meantime, I
have to find a new broker. I don't mind
reasonable commissions.
What I have a right to expect, do all
traders, is reasonable reliability,
responsiveness by phone and FULL,
TIMELY, disclosure when a problem does
occur so traders can minimize exposure. |
