E*Trade sucks! I talked to E*Trade rep again regarding my oversell.
He told me oversells are ILLEGAL according to SEC rules and
regulations. He told me we sign contract when we opened an account
with Etrade saying we are responsible for all trades we put in. And
that they do not check our orders. So, you can oversell all you want.
But you are doing something illegal and hence Etrade can correct it
anytime they want! And they will. He said oversell does not generate
short position. PERIOD. I told him I had talked to a rep earlier
and he had told me that we have 3 working days to decide what we
want to do with the oversell. I had called to make sure this oversell
is treated as a short. The rep I talked to today, told me that what
the other rep told me is wrong and he said "I am sorry someone
gave you wrong information".
If I was given wrong information, why hold me responsible for it?
I asked him this question and he told me, you oversold, its your
mistake. You will have to take the loss and there is nothing much
we can do about it.
But I insisted saying many other brokerages such as Datek do not
have "Sell Short" on their trading page. If I want to short there,
I just enter an sell order as usual and if I dont have shares, it
generates a short. He kept on insisting that its illegal. I asked
him to show me Etrade's rules and regulation on oversells. He said,
I am not going to show you anything, you can do your research. Check
sec rules or books on short selling.
I argued with him and he insisted that there is nothing we can do.
I insisted on talking to the supervison and he THREATENED me saying
if you want to pursue this further, we can take to trading dept
and this trade being illegal, they will remove both the oversell and
short cover (in which case I would lose some money!)
Well, if its illegal, I will take a loss!! But get me a supervisor.
He said there are none at this point, I will have someone all ASAP.
Finally a supervisor called and he confirmed that its an illegal
trade. He refused to do any adjustments. He put me on a 90 day
restriction and let me keep the profit. Other alternative was to
void both transaction and lose the profit also.
Well, that ends the story for me. I am certainly moving my account
out of Etrade.
But you guys BEWARE. Etrade considers oversell as ILLEGAL. So,
they can cover anytime....YOU DO NOT HAVE 3 DAYS TO DECIDE! This
supervisor told me he is going to trace my calls and then make sure
the person who gave me the 3-day thing is trained properly.
Can someone please point me to SEC rules on overtrading, if any?
--manny
ps: If anyone had a loss due to an oversell, maybe you could call
them to void both trades then you would have no loss!!! |
