Ali Lee Khadivi, an on-line investor today filed an arbitration with the National Association of Securities Dealers against E*Trade Securities, Inc. (Nasdaq: EGRP) alleging that E*Trade executed a limit order that Mr. Khadivi had previously canceled causing substantial losses. Mr. Khadivi, like thousands of other customers, were frozen out of the stock market during peak trading hours on the morning of February 3rd and 4th when E*Trade’s trading system was disabled by a software glitch. Customers who signed on hoping to place trades were met with a message that read, “Access to some areas of your account may be temporarily unavailable.” Mr. Khadivi is represented by Ryan Bakhtiari, a Beverly Hills, California attorneys that represents customers in securities arbitrations.
According to Ryan Bakhtiari, “E*Trade originally announced that it would consider compensating customers for any losses they incurred on a case-by-case basis and that it had set up a special e-mail address for customers with questions or complaints about recent outages.”
Robert A. Uhl added that “typically brokerage houses tell the customer that they are at fault and in Mr. Khadivi’s case, instead of making him whole after E*Trade wiped him out, they turned his account over to a collection agency and threatened to make a negative report to a credit reporting agency.”
The firm currently represents many investors who have lost money due to the fault of on-line trading firms and has, in the past, been responsible for recovering millions of dollars in stock market losses for their clients.