Is TD Ameritrade a Scam

Is TD Ameritrade Safe and Legit or a Scam? TD Ameritrade Review (2024)


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Charles Schwab has acquired TD Ameritrade and discontinued it. Please read our detailed Charles Schwab Review or Is Charles Schwab Safe articles.


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Is TD Ameritrade a Scam?


Most people are probably familiar with the name TD Ameritrade. TD Ameritrade is one of the most popular brokers in the U.S. In this article, we will examine if TD Ameritrade is a safe and legitimate company and provide a brief review of them.


TD Ameritrade Company Overview


TD Ameritrade has been in business for over 40 years and is one of the largest brokers in the U.S. today. TD Ameritrade was also a publicly-traded company for many years.

According to its website, TD Ameritrade has over 11 million client accounts and over $1 trillion in assets under administration. They provide custodial services for over 6,000 investment advisors. On average, their client base places a total of over 500,000 trades per day. According to Charles Schwab’s 10-K annual report from last year, TD Ameritrade generated over $7 billion of revenue in 2021.


Is TD Ameritrade Legitimate?


Operating in the financial industry and more specifically operating as a broker/dealer, TD Ameritrade is an extremely highly regulated company. There is a long list of regulators that oversee TD Ameritrade’s business. The main regulators include the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), the U.S. Financial Crimes Enforcement Network (FinCEN), the Office of Foreign Assets Control (OFAC), the Internal Revenue Service (IRS) and state securities regulators.

With this many eyeballs constantly monitoring every move that TD Ameritrade makes and with how long TD Ameritrade has been in business, it is virtually impossible for TD Ameritrade not to run a legitimate operation and be running a scam. In addition to all its regulators, TD Ameritrade is also voluntarily registered with the Better Business Bureau.


TD Ameritrade Reviews & Complaints


Any company that has been in business for over 40 years and is the size of TD Ameritrade is going to have some history of negative reviews and complaints. The good news is that there are a few different public resources that anybody can use to browse through the customer reviews and customer complaints about them.


is Ameritrade a scam?


TD Ameritrade has had a profile with the Better Business Bureau (BBB) since 1980 and they have an A rating. They have 427 complaints against them that have been closed in the last three years (extremely tiny number considering 11 million customers) and the details of all the complaints are open to the public for review. They have a 1.14 out of 5-star customer review score however, that is over an extremely small sample size of only 36 customer reviews. And let’s be honest, most customers taking the time to submit a review are probably the angry ones.


is Ameritrade safe?


Like all brokers, TD Ameritrade has a public profile with FINRA. Their CRD# with FINRA is 7870 and anybody can use this number to view their profile. They have a total of 201 disclosures on their FINRA profile.


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TD Ameritrade Awards & Accolades


TD Ameritrade has stacked its trophy case with many credible awards in the brokerage industry. Most recently in 2024, TD Ameritrade was awarded by Investopedia as best broker for customer service, best broker for beginners, and best mobile app. TD Ameritrade was also awarded by major financial magazine as number one in 2024 in six categories including Platforms & Tools, Desktop Platform, Active Trading, Options Trading, Customer Service, and Phone Support. To top all of the awards off, TD Ameritrade took home 2024 Best Online Broker for Stock Trading Platform and Research award.

TD Ameritrade has not only collected many awards this year in 2024, but they have also been winning awards for many years prior. It would be tough for any non-legitimate or scam company to repeatedly win awards for their business year after year. TD Ameritrade’s thinkorswim platform has been crowned the number one Desktop Platform for 10 years in a row.


Is TD Ameritrade a Safe Place to Keep Your Money & Investments?


If you are an investor with your money at TD Ameritrade or you are thinking of moving your money to TD Ameritrade, you will be happy to know that TD Ameritrade has multiple layers of insurance and protection when it comes to keeping your money safe. TD Ameritrade offers Securities Investor Protection Corporation Insurance (SIPC insurance), Federal Deposit Insurance Corporation Insurance (FDIC insurance), Supplemental Insurance, and an Asset Protection Guarantee.


Is td ameritrade reliable?


All investors are automatically eligible for TD Ameritrade’s Asset Protection Guarantee. This guarantee covers any lost cash or securities due to unauthorized activity on your account. As long as the unauthorized activity was caused by no fault of your own, TD Ameritrade will reimburse you for your lost funds. This guarantee is a program that not many brokers offer, and it reinforces the sentiment that TD Ameritrade has the best interest of its clients in mind.

Investors’ money is never insured against losses in the market but with SIPC and FDIC insurance, your money is insured if TD Ameritrade were to go bankrupt or go out of business. The SIPC insurance protects your cash and securities in a brokerage account up to a total of $500,000, including a maximum of $250,000 of cash. For FDIC insurance, TD Ameritrade offers a special type of cash account that automatically sweeps your cash into multiple different FDIC-insured bank accounts so that you can have a much greater amount of overall coverage than the standard FDIC coverage of $250,000.

If the SIPC and/or the FDIC coverage isn’t already enough protection, TD Ameritrade provides each client with a special type of supplemental insurance through London insurers. The supplemental insurance covers excess amounts of cash and securities over the $500,000 SIPC coverage up to a certain limit for each client and for the firm in total.


Is TD Ameritrade a Scam or Legitimate? The Conclusion.


Based on all the information presented in this article, the final verdict is that TD Ameritrade is absolutely not a scam, and they are completely legitimate. If TD Ameritrade was a scam or not legitimate, it’s safe to say that it would be quickly shut down by one of the many regulators watching over them.


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TD Ameritrade Complaints


While the broker's advanced desktop platform, thinkorswim, has received compliments for some of its strong points, a number of customers have complained that it can be more buggy than other software programs. In a test, it took one minute and 28 seconds to load thinkorswim on Windows 10, while Schwab's platform took just 43 seconds.

Traders have complained that TD Ameritrade three separate mobile apps are somewhat cumbersome, compared to having just one. A thinkorswim app is designed with charting and trading in mind. A Mobile Trader version is very similar. A basic app provides funds transfer, account statements, and mobile check deposit. It would be more convenient to combine the three apps into one. Also, thinkorswim and Mobile Trader offer live streaming of CNBC, but only in standard definition. The Fidelity app, by contrast, has live streaming of Bloomberg in HD.

Despite TD Ameritrade's notoriety for its technical tools, it does not have an app for Apple TV. Fidelity traders do have access to this nice feature.

Checking account features can be added to a securities account at TD Ameritrade. However, the broker does not provide savings accounts. It also does not offer mortgage loans. Merrill Edge brokerage customers have access to both.

Website charting with TD Ameritrade only has 33 technical studies. By comparison, Ally Invest's web-based graphing software provides roughly 90. Trendlines are available, but the frequently used Fibonacci retracements are not.

While TD Ameritrade does offer margin accounts, its loan rates tend to be on the high side. Currently, a margin debit of $10,000 or under costs 14.75%. Robinhood charges just 6.75%.

While broker-assisted trades are available at TD Ameritrade, the firm does charge a very steep price for them — $25.

Trading a non-NTF mutual fund at TD Ameritrade costs $49.99 on both the sell and buy sides. By contrast, WellsTrade customers pay $35 for non-NTF funds, Firstrade charges $0.


TD Ameritrade Complaints


And the last TD Ameritrade complaint: while the broker offers customer service over the phone, it does not have an on-line chat service. This absence stands out as a lapse when several other firms, including Ally Invest and Firstrade, do offer on-line customer service.


TD Ameritrade Bullish Signs


Even though TD Ameritrade clients do have some grievances, the company manages to bring a lot to the table. For example:

$0 commission stock and ETF trades. It doesn't get any better!

Customer service is available 24 hours a day, 7 days a week over the phone. Vanguard does not have 24/7 service, by contrast. TD Ameritrade clients can also find an associate at one of the company's local branches. Currently, there are more than 450+ locations throughout the United States.

TD Ameritrade offers one of the best selections of technology of any on-line discount broker. There is highest rated trading platform in the industry - thinkorswim. It has very advanced charting tools and 400 technical studies. thinkorswim, both in desktop and mobile versions, has paper trading capability. Most other brokers, including Fidelity and Schwab, don't offer this useful feature.

There is no opening deposit requirement for a brokerage account with TD Ameritrade. This policy allows traders to open an account with no money down and try out the broker's technology. Even better, there are no account maintenance or closeout fees.

Over 13,000 mutual funds are open to new investors. By comparison, E*Trade, Schwab, and Merrill Edge offer fewer.

4,200 mutual funds at TD Ameritrade can be traded without paying a commission. This is more than at almost all other brokers.

Futures and forex are both available at TD Ameritrade. Most other securities brokers don't offer these products.


TD Ameritrade Complaints Summary


Investors at TD Ameritrade complain mostly about the broker's mutual funds commissions. But they definitely get a lot of valuable services in return which other brokers either don't offer or charge additional fees. TD Ameritrade is an Audi of investing world and the price on mutual funds reflects the quality.


Updated on 2/23/2024.


About the Author
Chad Morris is a financial writer with more than 20 years experience as both an English teacher and an avid trader. When he isn’t writing expert content for Brokerage-Review.com, Chad can usually be found managing his portfolio or building a new home computer.