Kerry, I think the other reason they get away with such shenanigans is that despite what you hear, they really don't have any real competition. Banks and such would never get away with that kind of stuff, because there IS plenty of competition, and people would just switch their accounts.
While there are what seems like a lot of online brokers out there, absolutely no one, except for the integrated order entry firms, provide the kind of representation, speed of executions (when working correctly), and low price, than Datek. With online brokering in it's infancy, and more and more consumers jumping into online trading, I think you'll see many more brokers like Datek pop up.
As with other industries, the ones who don't provide will fall by the wayside, and the ones who do will find themselves leading the pack. I think it's only then that we'll see them not being allowed to get away with everything, because the attrition will be greater than the new signups. At present, Datek still has a captive market, for the most part. Signups far outnumber attrition for them presently.
In addition, if NASD goes through with their plans to have just one limit book, and the ECN's like ISLD don't give advantage to firms like Datek, where cross-ownership is the rule. I think you'll see this competition accelerate.
Len |
