Robinhood business applications faces fines of up to $ 70 million for their business practices. The company also applied for public trading.
Robinhood faces charges of unfair practices
Trading applications for trading stocks and cryptocurrencies face huge fines from financial regulators. The U.S. Financial Industry Regulatory Authority (FINRA) fined Robinhood on Wednesday.
The report comes only a day after the company filed a request for an initial public offering (IPO) with the US Securities and Exchange Commission (SEC). The company states that their goal is to democratize finances for all. You can view the entire document under the attached link HERE.
The day before, the company had received a notification from the financial regulator FINRA, which ordered the company to pay fines in the amount of 57 million US dollars. It is supposed to provide restitution for some customers for about $ 12.6 million.
“The fine imposed in this case reflects the extent and gravity of the Robinhood violation, including FINRA’s finding that the company disclosed false and misleading information to millions of its customers.”
According to the regulatory authority, Robinhood’s allegations include distorted margin transactions, holdings of users’ cash in application accounts, and the risk of losing option transactions. The Office further states that the company did not admit or refute the allegations and agreed to enter FINRA’s findings.
“The company has caused extensive harm to millions of its clients in connection with the alleged system failures.”
Robinhood faced a giant wave of criticism during the GameStop frenzy of February this year. However, the business application denied any manipulation of the price or acting on behalf of someone else. Do you use Robinhood to trade?