Robinhood Smacked with FINRA Fine
Back in June 2021,Robinhood was ordered to pay a $57 million fine by financial regulator FINRA for “outages and misleading customers” during market volatility in March 2020. An additional $13 million in restitution was included as part of the penalty, bringing the total fine to over $70 million. It was, and still is, the largest FINRA penalty imposed.
It also wasn’t the first fine against the controversial new-age broker-dealer, and obviously wouldn’t be the last. FINRA looks prepared to make Robinhood pay up for its role in the January 2020 stock market volatility, during which the broker-dealer froze trading in retail-popular stocks like GameStop, AMC Entertainment, American Airlines, and Koss. The regulator has ordered Robinhood to pay $29,460.77 to a 27-year-old truck driver from Connecticut who suffered “significant investment losses“ due to Robinhood’s decision to limit trading. 🤭 At face value, $29,000 isn’t much to a $14 billion company. However, it’s a first-of-its-kind judgment related to the January market volatility. When you start to consider how many tens of thousands of other cases might be filed with the regulator, $29,000 might be the least of Robinhood’s problems. 😬