Thousands of clients of ICICIdirect were left in the lurch on Thursday, as its trading site was nonoperational for more than 24 hours. Many customers are venting their anger through comments on Moneylife.in and other forums
The unavailability of ICICIdirect's trading portal during trading hours on Thursday has left many of its customers feeling let down and some of them are even looking at ways to initiate proceedings against the brokerage.
Several hapless customers have been venting their frustration on various forums on the Internet. One of the comments on our previous article reads, "They should pay a fine or forego their fees for the year when the site crashes for the whole day. Site not working for a short period is understandable, but a system where people are likely to have lost crores of rupees has to be accountable. How I wish I could sue them like in countries like the US."
A reader in his comment on moneycontrol.com has asked whether there is any way the Securities and Exchange Board of India (SEBI) can interfere, or if the Company Law Board can take some action. "How can the losses of the members of ICICIdirect services be compensated? Can we move the consumer court for a remedy?" the reader asked.
However, customers using online trading accounts cannot initiate legal proceedings against their brokerage for website malfunction. While opening an online trading account, customers sign an agreement, which clearly says that the brokerage cannot, and does not guarantee continuous, uninterrupted or secure access to the Internet, the website or linked site(s).
This is what the disclaimer on ICICIdirect.com says, "ICICI Securities Ltd (ISEC) along with its directors, employees, associates or other representatives and its Affiliates along with its directors, employees, associates or other representatives shall not be liable for damages or injury arising out of or in connection with the use of the www.icicidirect.com (Website) or its non-use including non-availability, compensatory, direct, indirect or consequential damages, loss of data, income or profit, loss of or damage to property, including without limitation loss of profits, loss or corruption of data, loss of goodwill, work stoppage, computer failure or malfunction, or interruption of business; under any contract, negligence, strict liability or other theory arising out of or relating in any way to the Website, site-related services, or any products or services and claims of third parties damages or injury caused by any performance, failure of performance, error, omission, interruption, deletion, defect, delay in operation or transmission, computer virus, communications line failure, theft or destruction or unauthorised access to, alteration of, or use of information, whether resulting, in whole or in part, from or relating to any of the services offered or displayed by ISEC on the Website."
On Thursday, Moneylife had revealed how the trading system as well as the phone-order service of ICICIdirect broke down yesterday, leaving numerous customers totally hapless. ICICIdirect is one of the largest trading portals in the country and its inability to set right the technical snags in its system is indeed appalling.
"Considering the number of account-holders on ICICIdirect and the position that ICICIdirect holds in the online trading business, this episode and the inadequate response of the company to it, reflects gross negligence on their part. I urge the authorities (SEBI and other regulatory bodies) to kindly investigate this failure and work out a mechanism by which the service provider is held accountable in instances of such failure to provide the services promised," read one comment on moneycontrol.com.
Usually, all the sites, especially those which deal directly with customers, have sufficient resources to fall back upon in case there is a technical problem. However, in the case of ICICIdirect's technical glitch, it appears that there was no backup available to handle such situations.
Despite our repeated attempts to know the exact reasons for the site crash, ICICIdirect and ICICI Securities were unable to provide any answer. This is what the spokesperson from both these entities has said: "We have resolved the technical glitch that we had faced yesterday. ICICIdirect.com is now completely functional and all our customers have been able to trade seamlessly on the site." There is neither any word on the brokerage's plan of action to avoid such situations in the future nor about any compensation to its customers who may have suffered losses.
According to Kirti Desai, a chartered accountant, this is not the first time a site of a brokerage has crashed. "The question is when SEBI does not allow any broker to stop trading, then how come such things happen time and again? I think there should be more transparency in the manner online sites of brokers operate," Mr Desai said.
With the advancement in technology - in terms of connectivity and infrastructure - online trading has reached a new high, where even delay of a second in placing an order can have significant financial impact. This exactly is the reason why more and more traders are opting for broadband or dedicated leased lines and trading terminals. However, since common investors are dependent on their broker's terminal or portal, they have no other option but to bear with the broker.
In addition, when the online trading portal of a reputed broker crashes then it may lead to irreparable damage for both the brokerage as well as its customers.
In his comment on moneycontrol.com, one reader even accuses the brokerage. The reader said: "My experience with ICICIdirect is whenever there is (a) big movement in (the) market, ICICI's site goes down due to reasons best known to them. There is nothing like 'technical error'. You can assume what is a big movement in markets on either side is beyond the control of ICICIdirect so they just hang up their system to prevent damage to their personal interests."
Echoing a similar feeling, one reader said, "I think SEBI should pitch in here. The quality of the website has been inconsistent. Some insiders say that ICICIdirect slows down when you need it the most. Not sure how true this is, but of late I have experienced trouble in modifying allocation on several occasions. The helpdesk is a paid-phone service that keeps (the) customer on wait for at least 5 minutes. To summarise, it is so unhelpful that one would rather keep to oneself than go to them."— Moneylife Digital Team