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| {{Short description|Defunct American stockbrokerage firm}} | |||
| {{Infobox_Company | | |||
| {{Infobox company | |||
| company_name = Scottrade Inc| | |||
| | name = Scottrade | |||
| company_logo = ] | | |||
| | former_name = Scottsdale Securities | |||
| company_type = ] | | |||
| | logo = Scottrade-Logo-2011.png | |||
| foundation = ] (]) | | |||
| | industry = ] | |||
| location = ], ] | | |||
| | fate = Acquired by ]<ref name=":3" /><ref name="closes" /> (later merged into ])<ref name=":1">{{Cite web |title=Charles Schwab completes acquisition of TD Ameritrade |url=https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/charles-schwab-completes-acquisition-of-td-ameritrade-60619300 |access-date=2023-05-02 |website=www.spglobal.com |language=en-us}}</ref><ref name=":0">{{Cite web |agency=Associated Press |date=2020-10-06 |title=Charles Schwab completes its $26B purchase of TD Ameritrade |url=https://nebraska.tv/news/local/charles-schwab-completes-its-26b-purchase-of-td-ameritrade |access-date=2023-05-02 |website=KHGI |language=en}}</ref> | |||
| ⚫ | |||
| | foundation = {{start date and age|1980}} | |||
| ⚫ | |||
| | defunct = {{end date and age|2017|09|18}} | |||
| branches = 285 (])| | |||
| | location = 12800 Corporate Hill Drive | |||
| revenue = $796 Million (]) | | |||
| | hq_location_city = ], ] | |||
| industry = ], Online Investing Firm | | |||
| | hq_location_country = ] | |||
| products = ], ]: Stocks, Mutual Funds, IRAs, CDs, Fixed Income, Etc. | | |||
| ⚫ | | key_people = ] (]) | ||
| homepage = | | |||
| | services = ]<br>]<br>] | |||
| | revenue = $1.1 billion (2016) | |||
| ⚫ | | num_employees = 3,700 (2016) | ||
| | parent = ]<ref name=":3" /><ref name="closes" /> | |||
| | website = | |||
| | footnotes = <ref>{{cite news | url=https://www.bizjournals.com/stlouis/news/2017/03/24/top-150-2017-no-22-scottrade-financial-services.html | title=Top 150 2017: No. 22 Scottrade Financial Services Inc. | work=] | date=March 24, 2017 | url-access=subscription}}</ref> | |||
| }} | }} | ||
| ]]] | |||
| ]]] | |||
| '''Scottrade''' was a ] and ] that operated via mobile, on the web, and at ]. In September 2017, the stock brokerage division of the company was acquired by ] (later merged into ]) and absorbed by that company; the banking division, Scottrade Bank, was acquired by ] and folded into ] | |||
| '''Scottrade''' is a privately owned discount ]age firm headquartered in ]. It is known for its online trading features, low commissions (it advertises that most orders – ]s or ]s – can be traded for a flat $7.00 commission, regardless of trade frequency or account size), and commercials featuring its founder and president, ]. | |||
| Scottrade has 287 local branch offices, and has previous been ranked "Highest in Investor Satisfaction with Online Trading Services" award by ] for an unprecedented six consecutive times (streak ending in 2006). | |||
| ==History== | ==History== | ||
| In 1980, Rodger O. Riney founded Scottsdale Securities as a retail ] in ].<ref name=closes>{{cite news | url=https://www.bizjournals.com/stlouis/news/2017/09/18/td-ameritrade-closes-on-acquisition-of-scottrade.html | title=TD Ameritrade closes on acquisition of Scottrade | first=Greg | last=Edwards | work=] | date=September 18, 2017 | url-access=subscription}}</ref><ref name=interview>{{cite news | url=https://www.bizjournals.com/stlouis/stories/2000/06/19/focus9.html | title=Rodger Riney, Scottrade Inc. | first=Gil | last=Stuenkel | work=] | date=June 18, 2000 | url-access=subscription}}</ref> In 1981, Riney moved to ] and opened a second branch.<ref name=SLBJ2004/><ref name=closes/> | |||
| In 1985, the company moved its headquarters to ].<ref name=closes/> | |||
| Scottrade was founded in 1980 by Riney as Scottsdale Securities in ], with two offices, one in Scottsdale and the other in St. Louis. One year later, Scottsdale Securities relocated its headquarters to St. Louis. | |||
| In 1996 Scottsdale Securities offered online trading to its customers, under the domain name of . It adopted the Scottrade name as its corporate name in 2000. | |||
| By 1989, the company had 6 branches, and by 1991, the company had 15 branches.<ref name=closes/> | |||
| In 2003, Scottrade launched a new trading platform, called Scottrade Chinese , available to customers in the United States, China, Hong Kong, and Taiwan. Also in August 2003, Scottrade opened its one-millionth customer account. In September, J.D. Power and Associates named Scottrade Highest in Investor Satisfaction With Online Trading Services for an unprecedented fourth consecutive time. | |||
| In 1996, the company launched its ] and ]. The number of trades increased by 15% per month, compounded monthly, for 39 months.<ref name=interview/> | |||
| October 2005 brought another J.D. Power and Associates award for Investor Satisfaction, the 6th in a row for Scottrade.<ref name="Scottrade Award"> — History (retrieved ] ])</ref><ref name="Scottrade JD"> — JD Powers and Associates(retrieved ] ])</ref> | |||
| By 2000, more than 90% of the company's trades were initiated online. The name of the company was changed to Scottrade because the domain Scottrade.com was available.<ref name=closes/><ref name=interview/><ref name=SLBJ2004/> | |||
| ==Commercials== | |||
| Scottrade is known for its commercials featuring Riney as a young boy. | |||
| For 2 years after the ] burst in 2000, revenue declined, although it fully recovered by 2004.<ref name=SLBJ2004/> | |||
| The first series featured Riney providing "a little bit extra" when performing lawn services and building a treehouse for his friends. | |||
| The company began offering Chinese-language services in its retail locations in 2001 and in 2003 made its online offerings available in Chinese.<ref>{{cite news | url=https://www.bizjournals.com/stlouis/stories/2003/05/05/daily70.html | title=Scottrade increases services to Chinese Community | work=] | date=May 8, 2003 | url-access=subscription}}</ref> | |||
| A recent series features Riney using technology to deliver newspapers and helping golfers select the right club. | |||
| Between 2000 and 2004, the company doubled the number of retail branch locations, reaching 211 in 2004.<ref name=SLBJ2004/> | |||
| The newest commercials feature Scottrade founder and CEO Rodger Riney in a Scottrade-branded helicopter on a quest to discover first-hand what his customers most like about Scottrade. The camera then zooms in, focusing on customers on the ground who explain their favorite reasons for having a Scottrade account. These commercials run as 15 second book ends on a commercial break or as two back-to-back for one 30 second spot. | |||
| By 2003, 98% of trades executed by the company were made online.<ref name=SLBJ2004/> | |||
| ==Community Involvement== | |||
| Many of the charitable initiatives Scottrade is involved in have been employee-driven. Scottrade employees have led collection drives for members of the military stationed overseas, and adopted families through the St. Louis Post-Dispatch's 100 Neediest Cases. | |||
| <ref name="Scottrade in the Community"> — Scottrade in the Community (retrieved ] ])</ref> | |||
| The firm is also focused in contributing to charitable causes within the St. Louis community, such as participating in the Komen Race for the Cure and the Alzheimer's Association's annual Memory Walk. Scottrade and its employees donate annually to the United Way, the National MS Society, the Special Olympics, the St. Louis Humane Society and the St. Louis Art Museum, just to name a few. Most recently, employees have donated generously to tsunami and hurricane relief, particularly because some of their coworkers lost their homes in the hurricanes. | |||
| <ref name="Community Involvement"> — Community Involvement(retrieved ] ])</ref> | |||
| In 2004, Scottrade bought an office building outside of St. Louis next to its call center to use as its corporate offices.<ref name=SLBJ2004>{{cite news | url=https://www.bizjournals.com/stlouis/stories/2004/05/31/story2.html | title=Trading Up | first=Christopher | last=Tritto | work=] | date=May 30, 2004 | url-access=subscription}}</ref> | |||
| ==Current events== | |||
| In 2006, Scottrade purchased the naming rights for the stadium of the ], which was renamed the Scottrade Center (now the ]).<ref>{{cite news | url=https://www.bizjournals.com/stlouis/stories/2006/09/04/daily33.html | title=Scottrade wins Blues arena naming rights | first=Christopher | last=Tritto | work=] | date=September 7, 2006 | url-access=subscription}}</ref> | |||
| In an open letter to Scottrade customers<ref name="Open letter"> — | |||
| Open letter from the President (retrieved ] ])</ref>, Riney discussed the recent activity of mergers and acquisitions in the discount brokerage sector. Riney stated that Scottrade is happy being an independent firm and that it has no plans to sell out to another company. | |||
| In 2008, the company launched Scottrade Bank.<ref name=closes/> | |||
| On Wednesday, January 18, 2006, ], along with selected Scottrade staff, rang the ] Stock Market Closing Bell. | |||
| In 2009, the company launched a ].<ref name=closes/> | |||
| In March 2006, Scottrade announced the hiring of ] as the ] (CMO) for the firm. Moloney, formerly Vice President of Corporate Marketing at ] in St. Louis, is a widely published author, strategist and keynote speaker on the subjects of customer satisfaction and loyalty. | |||
| In September 2017, the stock brokerage division of the company was acquired by ] (later merged into ]) and absorbed by that company; the banking division, Scottrade Bank, was acquired by ] and folded into ]<ref name=":3">{{cite press release | url=https://www.businesswire.com/news/home/20170918006375/en/TD-Ameritrade-Closes-Acquisition-Scottrade-Financial-Services | title=TD Ameritrade Closes Acquisition of Scottrade Financial Services, Inc. | publisher=] | date=September 18, 2017}}</ref><ref name=":2">{{cite press release | url=https://www.newswire.ca/news-releases/td-bank-group-completes-acquisition-of-scottrade-bank-645465053.html | title=TD Bank Group Completes Acquisition of Scottrade Bank | publisher=] | date=September 18, 2017}}</ref><ref name="closes" /> | |||
| In April 2006, Scottrade announced that customer assets increased 45% for the first quarter 06 and client volumes rose 49%. According to a press release by Scottrade, it said that customer assets grew to over $51 billion, up from $32.5 billion from the same period last year. The firm's active accounts also grew to 1.48 million, up 28%. In addition, Scottrade opened 12 new branch offices in the United States, a solid 1 per week during the quarter. Since then they have opened several more and now have 287 branches. | |||
| ==Controversies== | |||
| In September 2006, Scottrade founder ] announced a partnership with the St. Louis Blues hockey club and arena. The new name of the arena--''']'''-- was revealed at a joint press conference. Terms of the deal were not disclosed, but were described as long-term and significant. Both Scottrade and the Blues said the agreement was equitable to both parties. One of the busiest arenas in the world, the Scottrade Center hosts over 40 Blues games and 130 non-hockey concerts and events each year. The prior naming rights partner, the financially struggling ], bought out the remaining years of its contract with the Blues in the summer of 2005 for $5.5 million. | |||
| ===Misrepresentations=== | |||
| In 2008, the ] (SEC) charged the company with making fraudulent misrepresentations to clients about ] ] in violation of the ]. The company consented to the entry of an order by the SEC that included a censure of Scottrade. The company also agreed to stop committing or causing any violations of the act, and paid a civil penalty of $950,000.<ref>{{cite press release | url=https://www.sec.gov/news/press/2008/2008-120.htm | title=SEC Charges Scottrade for Misrepresentations to Customers | publisher=] | date=June 24, 2008}}</ref> | |||
| ===Violations of record-keeping requirements=== | |||
| October 12, 2006 was declared “Scottrade Day” in St. Louis. The proclamation, issued by Mayor Francis G. Slay, declares Oct. 12, 2006, as a day to recognize and honor Scottrade for the significant contributions the company has made to the St. Louis community. Scottrade CEO Riney cut a large ribbon on ice to christen the newly named and renovated facility. | |||
| In January 2014, the company admitted to violating the record keeping requirements of federal security laws. The U.S. Securities and Exchange Commission submitted a request for data describing its trades as part of an investigation into whether an account had been hacked and unauthorized trades made for a customer. Every brokerage firm is required to keep trading records under the law. The company was missing data over a six-year period. As part of the settlement, the company agreed to admit fault and pay a fine of $2.5 million.<ref>{{cite press release | url=https://www.sec.gov/news/press-release/2014-17 | title=Scottrade Agrees to Pay $2.5 Million and Admits Providing Flawed "Blue Sheet" Trading Data | publisher=] | date=January 29, 2014}}</ref> | |||
| ===Database hack=== | |||
| In November 2006 Scottrade announced a 72 percent increase in revenue for fiscal year 2006, which ended September 30. Company revenue increased to $796 million, compared to $464 million in fiscal year 2005. Customer assets increased $9.6 billion to $51.1 billion. Trade volumes and active accounts also increased significantly over the previous fiscal year. The firm ranked as one of the largest privately held firms in the state of Missouri and one of the fastest growing U.S. firms of its size. Scottrade also announced it opened 39 branches in fiscal 2006 for a total of 280 branch offices throughout the US. The firm added 257 employees for a total of 1,640. Customer growth in 2006 was also significant as the firm ranked as one of the largest U.S. advertisers, according to TNS Media. | |||
| In October 2015, Scottrade revealed that, in late 2013 and early 2014, ]s accessed an encrypted database containing the personal records of more than 4.6 million clients, including names, street addresses, email addresses, social security numbers, and other sensitive account data.<ref>{{cite news | url=https://www.wsj.com/articles/scottrade-discloses-data-breach-potentially-targeting-4-6-million-clients-1443815069 | title=Scottrade Discloses Data Breach Potentially Targeting 4.6 Million Clients | last=Huang | first=Daniel | work=] | issn=0099-9660 | date=October 2, 2015 |url-access=subscription }}</ref> The company became aware of the breach when it was approached by Federal authorities who were investigating similar thefts at other financial service companies.<ref name=fortunebreach>{{cite news | url=http://fortune.com/2015/10/02/scottrade-data-breach/ | title=Scottrade data breach affects millions of customers | first=Robert | last=Hackett | work=] | date=October 2, 2015}}</ref> As a precaution, Scottrade offered ] services to all affected customers.<ref name=fortunebreach/><ref>{{cite news | url=https://www.marketwatch.com/story/scottrade-hackers-had-access-to-brokerage-account-numbers-company-reveals-2015-10-08 | title=Scottrade hackers had access to brokerage account numbers, company reveals | first=PRIYA | last=ANAND | work=] | date=October 8, 2015}}</ref> | |||
| In November 2015, after performing its own investigation of the breach, the ] fined Scottrade $2.6 million for failing to store financial records and emails completely and securely and for failing to have an organized process for doing so. The company had deleted and failed to save over 168 million outgoing emails with trading information. Scottrade did not admit to or deny these charges, but consented to an entry of FINRA's findings and agreed to pay the fine.<ref>{{cite press release | url=http://www.finra.org/newsroom/2015/finra-fines-scottrade-26-million-significant-failures-required-electronic-records-and | title=FINRA Fines Scottrade $2.6 Million for Significant Failures in Required Electronic Records and Email Retention | publisher=] | date=November 16, 2015}}</ref> | |||
| ==Footnotes and references== | |||
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| == |
==References== | ||
| {{Reflist|1}} | |||
| {{Online brokerages}} | |||
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Latest revision as of 04:09, 19 October 2024
Defunct American stockbrokerage firm | |
| Formerly | Scottsdale Securities |
|---|---|
| Industry | Financial services |
| Founded | 1980; 44 years ago (1980) |
| Defunct | September 18, 2017; 7 years ago (2017-09-18) |
| Fate | Acquired by TD Ameritrade (later merged into Charles Schwab Corporation) |
| Headquarters | 12800 Corporate Hill Drive, St. Louis, Missouri, United States |
| Key people | Rodger O. Riney (CEO) |
| Services | Stockbroker Electronic trading platform Personal banking |
| Revenue | $1.1 billion (2016) |
| Number of employees | 3,700 (2016) |
| Parent | TD Ameritrade |
| Footnotes / references | |
Scottrade was a stockbroker and electronic trading platform that operated via mobile, on the web, and at branches. In September 2017, the stock brokerage division of the company was acquired by TD Ameritrade (later merged into Charles Schwab Corporation) and absorbed by that company; the banking division, Scottrade Bank, was acquired by Toronto-Dominion Bank and folded into TD Bank, N.A.
History
In 1980, Rodger O. Riney founded Scottsdale Securities as a retail stockbroker in Scottsdale, Arizona. In 1981, Riney moved to St. Louis and opened a second branch.
In 1985, the company moved its headquarters to St. Louis.
By 1989, the company had 6 branches, and by 1991, the company had 15 branches.
In 1996, the company launched its website and electronic trading platform. The number of trades increased by 15% per month, compounded monthly, for 39 months.
By 2000, more than 90% of the company's trades were initiated online. The name of the company was changed to Scottrade because the domain Scottrade.com was available.
For 2 years after the dot-com bubble burst in 2000, revenue declined, although it fully recovered by 2004.
The company began offering Chinese-language services in its retail locations in 2001 and in 2003 made its online offerings available in Chinese.
Between 2000 and 2004, the company doubled the number of retail branch locations, reaching 211 in 2004.
By 2003, 98% of trades executed by the company were made online.
In 2004, Scottrade bought an office building outside of St. Louis next to its call center to use as its corporate offices.
In 2006, Scottrade purchased the naming rights for the stadium of the St. Louis Blues, which was renamed the Scottrade Center (now the Enterprise Center).
In 2008, the company launched Scottrade Bank.
In 2009, the company launched a mobile app.
In September 2017, the stock brokerage division of the company was acquired by TD Ameritrade (later merged into Charles Schwab Corporation) and absorbed by that company; the banking division, Scottrade Bank, was acquired by TD Bank Group and folded into TD Bank, N.A.
Controversies
Misrepresentations
In 2008, the U.S. Securities and Exchange Commission (SEC) charged the company with making fraudulent misrepresentations to clients about Nasdaq pre-open orders in violation of the Securities Exchange Act of 1934. The company consented to the entry of an order by the SEC that included a censure of Scottrade. The company also agreed to stop committing or causing any violations of the act, and paid a civil penalty of $950,000.
Violations of record-keeping requirements
In January 2014, the company admitted to violating the record keeping requirements of federal security laws. The U.S. Securities and Exchange Commission submitted a request for data describing its trades as part of an investigation into whether an account had been hacked and unauthorized trades made for a customer. Every brokerage firm is required to keep trading records under the law. The company was missing data over a six-year period. As part of the settlement, the company agreed to admit fault and pay a fine of $2.5 million.
Database hack
In October 2015, Scottrade revealed that, in late 2013 and early 2014, hackers accessed an encrypted database containing the personal records of more than 4.6 million clients, including names, street addresses, email addresses, social security numbers, and other sensitive account data. The company became aware of the breach when it was approached by Federal authorities who were investigating similar thefts at other financial service companies. As a precaution, Scottrade offered identity protection services to all affected customers.
In November 2015, after performing its own investigation of the breach, the Financial Industry Regulatory Authority fined Scottrade $2.6 million for failing to store financial records and emails completely and securely and for failing to have an organized process for doing so. The company had deleted and failed to save over 168 million outgoing emails with trading information. Scottrade did not admit to or deny these charges, but consented to an entry of FINRA's findings and agreed to pay the fine.
References
- ^ "TD Ameritrade Closes Acquisition of Scottrade Financial Services, Inc" (Press release). Business Wire. September 18, 2017.
- ^ Edwards, Greg (September 18, 2017). "TD Ameritrade closes on acquisition of Scottrade". American City Business Journals.
- "Charles Schwab completes acquisition of TD Ameritrade". www.spglobal.com. Retrieved 2023-05-02.
- "Charles Schwab completes its $26B purchase of TD Ameritrade". KHGI. Associated Press. 2020-10-06. Retrieved 2023-05-02.
- "Top 150 2017: No. 22 Scottrade Financial Services Inc". American City Business Journals. March 24, 2017.
- ^ Stuenkel, Gil (June 18, 2000). "Rodger Riney, Scottrade Inc". American City Business Journals.
- ^ Tritto, Christopher (May 30, 2004). "Trading Up". American City Business Journals.
- "Scottrade increases services to Chinese Community". American City Business Journals. May 8, 2003.
- Tritto, Christopher (September 7, 2006). "Scottrade wins Blues arena naming rights". American City Business Journals.
- "TD Bank Group Completes Acquisition of Scottrade Bank" (Press release). CNW Group. September 18, 2017.
- "SEC Charges Scottrade for Misrepresentations to Customers" (Press release). U.S. Securities and Exchange Commission. June 24, 2008.
- "Scottrade Agrees to Pay $2.5 Million and Admits Providing Flawed "Blue Sheet" Trading Data" (Press release). U.S. Securities and Exchange Commission. January 29, 2014.
- Huang, Daniel (October 2, 2015). "Scottrade Discloses Data Breach Potentially Targeting 4.6 Million Clients". The Wall Street Journal. ISSN 0099-9660.
- ^ Hackett, Robert (October 2, 2015). "Scottrade data breach affects millions of customers". Fortune.
- ANAND, PRIYA (October 8, 2015). "Scottrade hackers had access to brokerage account numbers, company reveals". MarketWatch.
- "FINRA Fines Scottrade $2.6 Million for Significant Failures in Required Electronic Records and Email Retention" (Press release). Financial Industry Regulatory Authority. November 16, 2015.
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