PSA: Scottrade hacked, customer data stolen

[George the original one]

Are these accounts FDIC insured? Up to 250K? Even against loss as a result of hacking?

In the case of fraud, don't companies have to legally restore all your money? Off course they could go bankrupt, that is another story.

No, they aren't FDIC insured. There is a group that insures the accounts in the event a broker goes bankrupt, but that insurance doesn't cover fraudulent activity. Just like FDIC isn't going to cover your money if someone else gets hold of your bankcard and performs unauthorized withdrawls.

[SimpleLife]

Are these accounts FDIC insured? Up to 250K? Even against loss as a result of hacking?

In the case of fraud, don't companies have to legally restore all your money? Off course they could go bankrupt, that is another story.

No, they aren't FDIC insured. There is a group that insures the accounts in the event a broker goes bankrupt, but that insurance doesn't cover fraudulent activity. Just like FDIC isn't going to cover your money if someone else gets hold of your bankcard and performs unauthorized withdrawls.

So who then pays the cost of the reimbursement I get from Bank of America every time my credit card is fraudulently used online? It's happened probably 4-5 times in the past 7 years.

[Chad]

The bank. Though, the banks are pushing through a new system that puts the onus on the merchants. The difference is they didn't steal any assets from you. Those are the banks assets they are stealing (soon to be the merchants) when it's a credit card. Those are your assets they are stealing inside your bank/brokerage account.