Interactive Brokers has agreed to pay over $1 million to settle allegations that it failed to supervise its employees in handling exchange fees charged to clients.
Trading platform Interactive Brokers had to pay more than $1 million to settle fees filed by the Commodity Futures Trading Commission (CFTC). The Division of Enforcement staff responsible for this matter is Ben Sedrish, Elizabeth M. Streit, Scott Williamson, and Robert Howell.
The regulator filed a lawsuit against Interactive Brokers LLC for failing to supervise its employees in handling exchange fees charged to clients. The order requires Interactive Brokers to stop violating CFTC rules by paying $710,828.14 in release with credit for money paid to affected clients and paying a $300,000 civil penalty.
According to the order, from approximately January 2015 to December 2021, Interactive Brokers failed to ensure that its employees accurately assessed exchange fees for client trading. More precisely, Interactive Brokers failed to implement the necessary changes to the exchange fee schedule, thereby charging customers who trade certain spreads with non-member exchange fees.
Although Interactive Brokers charge clients high fees, IBKR pays the exchange a lower fee for spread trading. As a result, the company overcharged the client by $710,828.14.
Interactive Brokers stated that the client's overcharged money had been refunded. The broker also advises affected former clients on how to get their refunds.
In the other news, recently, Interactive Brokers chairman Peterffy Thomas disclosed the disposal of shares in three separate transactions, 12.8K shares at $56.53/share, 7.2K shares at $57.27/share, and $20K shares at $57.66/share.