Robinhood to Pay $70M for Outages in March 2020
Main page News, US Market, Regulations

Financial Industry Regulatory Authority (FINRA) has ordered Robinhood to pay a $70 million fine for "systemic supervisory failures and significant harm suffered by millions of customers." According to the statement, the Menlo Park-based broker-dealer "negligently" provided millions of its customers with false or misleading information.

Subscribe to our Telegram channel to stay up to date on the latest crypto and blockchain news.

The watchdog also says millions of customers affected by the firm’s systems outages in March 2020, and thousands of customers the firm approved to trade options "even when it was not appropriate for the customers to do so."

"This action sends a clear message — all FINRA member firms, regardless of their size or business model, must comply with the rules that govern the brokerage industry, rules which are designed to protect investors and the integrity of our markets," said Jessica Hopper, Executive Vice President and Head of FINRA’s Department of Enforcement.

Robinhood Might Delay IPO Over Its Crypto Arm: Report

FINRA found that Robinhood failed to exercise due diligence before approving customers to place options trades. As a result, the firm allowed thousands of customers for options trading who did not satisfy the firm’s eligibility criteria.

Access more than 50 of the world's financial markets directly from your EXANTE account – including NASDAQ, London Stock Exchange and Tokyo Stock Exchange.

Read also:
Please describe the error