4 ms·

> brokers cannot lend your shares without a written agreement allowing it. Just read my brokers agreement - they can indeed lend my shares without notifying me

• snowwrestler 10y ago
  > even if that clause was in your contract, they have to notify you whenever they lend your shares. That right to notification CANNOT be waived in the agreement.
• scott00 10y ago
  You didn't mention whether it was a cash account or a margin account, or if there's an exception for fully paid securities. If it's a margin account, that is indeed how it works for non-fully paid securities. If it's a cash account, or there's no exception for fully paid securities, regulators will probably not view that agreement favorably. You can file a complaint at https://www.sec.gov/complaint/tipscomplaint.shtml https://www.sec.gov/complaint/tipscomplaint.shtml. In my experience, they actually read and act on complaints. (Well, at least small easy to investigate ones... ones requiring a lot of investigatory work like the Madoff case are a different story.) The relevant regulation is 17 CFR §240.15c3-3, paragraphs b(1), b(3), and b(3)ii. (http://www.ecfr.gov/cgi-bin/text-idx?SID=f07570958d348a3f75d9c979186842b8&mc=true&node=se17.4.240_115c3_63&rgn=div8 http://www.ecfr.gov/cgi-bin/text-idx?SID=f07570958d348a3f75d...)