Laurent J. LaBrie v. TDAmeritrade

Laurent LaBrie takes TD Ameritrade ("TDAmeritrade" or "TDA") to the Better Business Bureau for misappropriation of $15,174 from a personal individually managed account

Better Business Bureau case # 300046993

Filed on : May 18 2009

Filed against :
TD Ameritrade, Inc.
4211 S 102nd St
Omaha NE 68127-1031

Complaint Description: The agreement between me and TDA is that all options in the money by more than 1 cent should be exercised.

On 10/27/08, in Acct #XXXX, I purchased 8 Put contracts on UDR, Inc., strike price: $25.00, expiration date: 1/16/09.

On 10/5/08, a TDA "options expert" told me that this option was normal and would be executed normally. He made no significant effort to inform himself or me about the favorable events regarding my position in this security that the OCC had made known to them. Even underestimating their value, I expressed my desire that it be executed at the appropriate time.

On 1/16 the closing price was $12.42, well below the strike price of $25. TDA confirmed in writing multiple times that the trade executed on 1/20, as expected and assigned it Transaction # XXXXXXXXXXX and CUSIP #XXXXXXXXX. $19,979.89 was credited to my account. Obviously, since they profess to strictly follow OCC guidance, their manually exercising the option demonstrated that their quality assurance checks at the time revealed that I had requested that they exercise the option.

On 3/17 at 09:39:01 I bought 800 shares of UDR at $7.40 to cover my position. Transaction #XXXXXXXXXXX and the same CUSIP Number proved that these were the same shares I had shorted. $5,929.95 was deducted from my account. TDA provided multiple confirmations that my cover of the short was executed.

On 3/28, two months after the exercise of the option, I was told by a TDA manager that these profitable trades were going to be reversed obviously against my wishes and best interests. I was very upset at this seemingly arbitrary and unlawful TDA action, and I strenuously objected. A manager, Mr. Bass, had told me that the option really hadn't exercised but that the documents sent me were incorrect. On 3/31, the Office of the President contradicted the manager and admitted in writing that it had been exercised.

Another claim of Mr. Bass is also discredited. He stated that TDA had known about the status of the option with the OCC and that the OCC told their members, including TDA: "MEMBERS SHOULD ADVISE THEIR CUSTOMERS TO TAKE THE FOLLOWING CONSIDERATIONS INTO ACCOUNT IN DECIDING TO EXERCISE, OR NOT TO EXERCISE, THESE OPTIONS." (Emphasis theirs.) Yet, he admitted that TDA had not made any significant attempt to follow the OCC guidelines and advise me of this matter, other than the extremely dubious claim to have received a busy signal when they tried to call me once. All my telephones divert into voice mail if they are in use, so a caller never receives a busy signal but is given the opportunity to leave a message. TDA has used my answering machine to communicate with me on other occasions. TDA refused to substantiate their claim with telephone records or recordings. In any case, one attempt to call is not due diligence.

Only after all my trades were profitable did they discover that they had been wrong two months earlier and I really hadn't authorized them. So, they misappropriated the funds. TDA clearly did not perform the same level of "quality assurance" checks on their records as they did when they exercised the options. If they had, they would have discovered that

1.) I had indeed requested they be exercised in December after the original notice from the OCC had been issued.

2.) I had accepted electronic confirmations and postings onto my account on their website,

3.) I had accepted two monthly statements about which the investors agreement states that after one month, any mistakes could not be reversed and

4.) I had covered the short.

All of these actions were unsolicited and more than I have ever done for any other security I have ever owned. If all these don't demonstrate my requesting these transactions, I don't know what does. Having received and accepted confirmations for two months, this is not a securities matter but misappropriation of personal property and violation of a contractual agreement to safeguard my funds and work in my best interest.

Your Desired Resolution:

Carolyn Sheets of the BBB has been assigned to this case.
She responded, "e;The Better Business Bureau is a nuetral 3rd party in disputes between businesses and consumers. We do not make judgements on the honesty or dishonesty of a business practice. This is why I suggested you might want to arbitrate this matter thru the arbitration process TD Amertrade provides. You should also file a complaint with the SEC if you feel there was a theft of your money. The SEC is a government agency with enforcement authority and the BBB is a private non profit group with none."e;

I'm not sure how the BBB gives ratings to companies without making judgments on the practices of a business.