Interactive Brokers Ireland ("IBIE") takes a proactive approach to customer protection. IBIE determines the amount of cash and securities owed to customers daily and segregates funds for the exclusive benefit of customers in bank accounts correctly identified as client segregated accounts.
IBIE performs a reconciliation of customer money at least daily to ensure that customer monies are properly segregated from the IBIE’s own funds. Customer-owned, fully-paid securities are protected in accounts at depositories and custodians that are specifically identified for the exclusive benefit of customers. IBIE reconciles positions in securities owned by customers daily to ensure that these securities have been received at the depositories and custodians.
IBIE applies real-time risk margin requirements to customer accounts. If a customer is deemed to have insufficient assets to cover the risk of their open positions, IBIE typically will perform real-time liquidations of their positions to return the account to margin compliance.
IBIE's real-time risk margin requirement and protective liquidations minimise customers’ exposure to losses attributable to other customers’ trading, and the risk that customer losses pose to IBIE.
Another major benefit of doing business with IBIE is that it does not carry any materially significant proprietary inventory. IBIE does not make any directional bets and only holds proprietary inventory to facilitate fractional share trading for its clients and to facilitate client trading in certain OTC products. Two of the most significant bankruptcies of the past decade (Lehman Brothers and MF Global) were caused by the risk generated from proprietary holdings.
Since IBIE does not make proprietary bets, the risk of IBIE going bankrupt and customer funds being tied up in a liquidation is significantly reduced.
Finally, IBIE is not affiliated with a bank. This provides IBIE with a more stable platform for its customers should a market-wide crisis arise.
Since IBIE is not a bank, it is likely that customers' assets would be returned in a more timely fashion than for bank-owned entities..