Trader Dealer gone Bankrupt

[sails]

Phoned our bank this morning to cancel TD and Berndale's third party authority to our CMT account. They had staff specifically to deal with the Opes Prime issues. Normally cancellations to third party authority has to be done in writing, however due to the situation it was accepted verbally and processed immediately.

I mentioned that I had not traded with TD for several weeks and did not have any open positions with them. I suggested that they (Opes Prime or their creditors) could not legally touch the funds and the operator replied "Not now they can't" as she had just terminated the 3rd party agreement.

So suggest anyone with third party authorities get them removed ASAP...

 

[gfresh]

Getting messy...especially if client's SMSF were held by Opes/Trader Dealer - it's illegal to transfer them to a third party. By ANZ taking hold of the securities, and even worse, selling them, this is exactly what has happened.

http://business.theage.com.au/nasty-turn-for-anz/20080331-22mg.html

 

[Trembling Hand]

From the above article

" Under prime brokers' contracts all assets of the client are taken as security and pledged either to the broker or its lenders."


not good, not good at all!!

 

[chops_a_must]

Getting messy...especially if client's SMSF were held by Opes/Trader Dealer - it's illegal to transfer them to a third party. By ANZ taking hold of the securities, and even worse, selling them, this is exactly what has happened.

http://business.theage.com.au/nasty-turn-for-anz/20080331-22mg.html

That's pretty bad.

ANZ have never been opposed to some shifty practices in the past. Seemed to be heavily involved in a lot of lending to Iraqi "development projects".

But all these suss business practices are now biting them in the ass.

 

[cuttlefish]

Does anyone find it odd that one of the blokes that started this business was a former ANZ bank executive. Isn't there some sort of conflict of interest to start a business backed by the bank you just held a senior executive role in?

Emini is a long-time ANZ Bank executive who rose to general manager of ANZ Nominees. He took over the bank’s securities lending division in 1990 before moving across to its stockbroker ANZ McCaughan Securities in 1992. (excerpt from Kohler article: http://www.businessspectator.com.au...LLAPSE-Billion-dollar-bust-D67EJ?OpenDocument)


This whole thing reeks and what reeks more is that the regulators allowed this sort of setup to occur.

 

[sails]

Looks like TD's assets and client base has been sold to MDS Financial group.

Melbourne-based MDS Financial Group said it had acquired Trader Dealer, in a joint venture with Noosa-based company Box Red.

Source:http://business.theage.com.au/chips-salvaged-from-broken-broker/20080403-2387.html

I see there is now some info on the TD site: http://www.traderdealer.com.au/

Also found a PDF file on the ASX news site with information: http://www.asx.com.au/asx/research/...s.jsp?searchBy=asxCode&allinfo=on&asxCode=MWS

 

[shyl]

I am planning to open an account with traderdealer. was looking for the review and found this thread. how are these guys now? are the problems sorted out and is it safe to deal with them? what about the margin lending from them?

 

[sails]

I am planning to open an account with traderdealer. was looking for the review and found this thread. how are these guys now? are the problems sorted out and is it safe to deal with them? what about the margin lending from them?

They were bought out by MDS and I traded with them for a while after that with no problems. The main problem as I understand was with Opes Prime, not Trader Dealer itself.

I didn't use margin lending with them either before or after the issues with Opes, so can't help there. However, if using any sort of margin lending, I would suggest you read any fine print very, very carefully. Apparently some traders using Opes for margin lending didn't realise that the ML documents they signed gave ownership of their shares to Opes. So when Opes went under, those customer's portfolios were in turn taken by the banks. Not sure if I have got all the details correct, but it was along those lines.

Hope this helps...

 

[shyl]

Thanks sails for your advice.

 

[sails]

Thanks sails for your advice.

You're welcome...

But it's not "advice" - only suggestions and sharing of personal experience.