FINRA Orders Historic Financial Penalty Against Robinhood Financial LLC for Systemic Supervisory Failures | KlaymanToskes
Summary
On June 30, 2021, Robinhood Financial LLC agreed to a Letter of Acceptance, Waiver and Consent (AWC) (Case No. According to FINRA investigations, during certain periods since September 2016, “the firm has negligently communicated false and misleading information to its customers. Third, FINRA found that, from January 2018 to February 2021, Robinhood “failed to reasonably supervise the technology that it relied upon to provide core broker-dealer services, such as accepting and executing customer orders. Between 2018 and late 2020, Robinhood experienced a series of outages and critical systems failures … Robinhood’s inability to accept or execute customer orders during these outages resulted in individual customers losing tens of thousands of dollars, and FINRA is requiring that the firm pay more than $5 million in restitution to affected customers.” Finally, between January 2018 and December 2020, FINRA stated that “Robinhood failed to report to FINRA tens of thousands of written customer complaints that it was required to report. Robinhood’s reporting failures included complaints that Robinhood provided customers with false and misleading information, and that customers suffered losses as a result of the firm’s outages and systems failures.” KlaymanToskes Can Help Recover Investment Losses Due to Robinhood Financial LLC For investors with investment losses that exceed $100,000 relating to Robinhood Financial LLC’s supervisory failures, especially those investors who were approved for options trading and suffered losses, as well as those having information relating to the manner in which the firm handled their accounts, are encouraged to contact Lawrence L. Klayman, Esq., at (561) 542-5131 and lklayman@klaymantoskes.com, and download our Special Investor Report.