The end of the brokerage: Schwab blames high trading costs and a technical problem

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Charles Schwab & Co. on Tuesday it said high trading rates and a technical problem with a key trader caused a temporary shutdown on its trading floor on Monday, a day when its clients rushed to get foreign market sales.

A spokesman for the company did not identify what type of technical problem prevented Schwab customers from accessing their accounts, or name the merchant.

“A combination of high volumes and a technical issue with a key vendor affecting our systems led to login issues and wait times that were longer than we expected,” the spokesperson said in an emailed statement, adding that the issues have been resolved and “the platforms are fully available.”

Other firms have also had problems.

Some US customers reported having trouble logging into their Fidelity and Vanguard accounts on Monday morning, the companies said on social media that day, as Wall Street’s main indexes opened higher due to weak economic data, tech company earnings reports and growing concerns. from a geopolitical point of view.

Outage tracking website Downdetector reported that about 14,500 Schwab users were unable to access the site, while more than 3,600 users reported problems with Fidelity.

Fidelity confirmed that some of its customers had intermittent outages on Monday morning but declined to comment further. A Vanguard spokeswoman declined to comment on the cause of Monday’s access problems with that company.

Steve Sanders, senior vice president at Interactive Brokers, said that in the first 90 minutes of trading on Monday, the company traded more than 5 million shares, compared to 5.9 million during the full trading session on Friday. Interactive Brokers said there were no disruptions Monday or overnight.

Some disgruntled investors reached out to Lawrence Klayman, an attorney whose Boca Raton, Florida law firm KlaymanToskes specializes in commercial arbitration claims.

“The wheels of justice grind slowly,” Klayman said, noting that it will take time and research to put together and file any claims, and that only those investors who lost $100,000 or more can find restitution a cost-effective remedy.

—By Suzanne McGee, Reuters