A federal lawsuit accuses Charles Schwab and TD Ameritrade of fabricating trades in a client's brokerage account, then erasing them.
Jeff Huntington, a California-based options trader with over two decades of market experience, is alleging that three fictitious trades appeared in his account on or about April 15, 2024, showing as executed orders in a put option contract. According to the filing (Huntington v. TD Ameritrade, Inc. et al, Case No. 1:26-cv-02206, E.D.N.Y.), none of those trades produced a clearing record, a trade confirmation, a position change, or an account statement entry.
The so-called phantom trades surfaced in the FIX April 19, 2024 $210 Put option contract. They carried filled-execution status, meaning they looked like real, completed trades on screen. But nothing behind them matched up. The Options Clearing Corporation had no record. No confirmation was ever sent. Within a day, the entries disappeared from his account entirely. The complaint alleges they were later scrubbed from the firms' internal systems as well.
The filing alleges this was not a glitch. It claims the trades were fabricated records that never corresponded to any actual market transaction, and that their deletion is consistent with destruction of records in connection with a pending proceeding.
The allegations go further. The suit claims the phantom trades were part of a wider pattern of manipulative order-handling and quote-fading stretching from 2022 to April 2024. On one trading day alone, Huntington alleges his orders were cancelled and rerouted more than 40 times, with the displayed bid price collapsing while the same option was quoted at materially different prices on competing platforms. His orders were being sent through payment-for-order-flow arrangements to market makers including Citadel Securities and Susquehanna International Group.
The filing also flags what it describes as a failure to produce mandatory records. Multiple SEC and FINRA recordkeeping requirements, including those governing audit trail data and surveillance alerts, are referenced. According to the suit, none of the required records tied to the phantom trades have been turned over despite seven months of discovery demands in a parallel FINRA arbitration.
For wealth management professionals and advisors who rely on broker-dealer platforms to custody client assets, the case raises pointed questions about trade verification, execution quality, and the reliability of the systems underpinning everyday portfolio management.
Huntington is seeking compensatory damages of not less than $2 million, with total claimed damages believed to exceed $40 million, plus disgorgement of payment-for-order-flow revenue and punitive damages.
The matter remains in its earliest stages. No determination on the merits has been made, and the defendants have not yet responded.
Choice anxiety, prestige bias, and the temptation to make selections based on outsourced confidence are just some of the parallels between investing and the world of wine tasting.
Regulators found Bank of America's monitoring software had a known flaw Merrill left uncorrected for years.
While AI has become a go-to research tool for affluent investors, new HSBC research suggests human advisors remain the deciding voice when investment decisions are made.
A 5-4 ruling preserves the Federal Reserve's independence for now, but the legal fight over presidential removal power is far from settled.
For years, large firms have been facing penalties and questions from regulators over interest rates for clients’ cash accounts.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
