The millennial-favored stock trading app Robinhood could pay a minimum of $26.6 million for a potential settlement around trading outages in March 2020, Reuters has learned, citing sources familiar with the matter.
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The company is reportedly in settlement talks with the Financial Institutions Regulatory Agency (FINRA), the US Securities and Exchange Commission (SEC) and the New York Attorney General's Office (NYAG). The brokerage plans to settle issues with FINRA, including the March 2020 outages and options trading by paying at least $26.6 million fine.
At the same time, Robinhood is about to fill for an initial public offering (IPO) this March. While no final decision has been made, the fintech company has already contacted underwriters about the filing.
In September 2020, Robinhood faced with a regulatory pressure allegedly due to the March outages which resulted in thousands of dollars of losses. According to Bloomberg, US consumer protection agencies received over 400 complaints about Robinhood over the first half of the year. The main reason for complaints is related to the March market crash when Robinhood ceased its operations for more than a day.
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