[kragen]

I've written real-time trading systems trading on IB. Their client library is a real pile of shit, so it's not surprising to hear that their internal systems are too. Reassuring to hear that they're going to eat the US$100M loss themselves instead of letting their customers have it. (Not that they were going to get US$9M out of this Shah guy anyway.) They never did us any wrong when we were their customers.

Does this pose a risk of IB going insolvent? If they do, is there a risk of their customers being just another creditor of a bankrupt corporation, with respect to the stocks and futures that IB holds on behalf of those customers? Or are those instruments held in bailment, or actually by some other company, rather than as IB assets?