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Robinhood to Pay $10.2 Million in Penalty for Harming Investors

Apr 07, 2023 · 1 min read · 48 points
Robinhood to Pay $10.2 Million in Penalty for Harming Investors
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Robinhood now has to pay up to $10.2 million as settlement charges as ordered by NASAA for critical system failures that harmed the investors.

Highlights

  • Robinhood Financial LLC ordered to pay up to $10.2 million in penalties for ‘operational and technical failures that harmed main street investors’ The penalty was decided after an inquiry into Robinhood’s operational shortcomings, led by state securities regulators in Alabama, Colorado, California, Delaware, New Jersey, South Dakota, and Texas.
  • In July 2021, FINRA charged Robinhood $70 million for harming clients through outages and critical system failures.
  • In March 2020, disruptions on the Robinhood platform affected traders, which served as the catalyst for the investigation.
  • No proof of fraudulent behavior by Robinhood was discovered and that Robinhood completely cooperated with the state investigation.
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