(Bloomberg) -- Robinhood Markets Inc. legal chief Dan Gallagher said he sees the Securities and Exchange Commission grasping to rein in a thriving online brokerage industry instead of adapting to the ways technology has changed it.
“Regulators need to catch up,” Gallagher, a former SEC commissioner, said Wednesday at a Security Traders Association conference. “That's the way I would -- if I was running the place -- look at it. Maybe take a look at our old rule book because of these new technologies.”
The SEC has been evaluating game-like features brokerages use to engage customers. Robinhood warned that regulatory intervention would face steep legal hurdles and could violate First Amendment free speech protections, according to a letter posted to the agency's website Tuesday.
Read more: Robinhood Sees High Legal Burden for SEC on Broker-App Rules
“It's more this nanny state first,” Gallagher added, with regulators taking a position that “we need to insert ourselves instead of just recognizing the rule book's old.”
Gallagher, 49, became Robinhood's chief legal officer last year, as retail trading surged. The late January run-up in meme stocks including GameStop Corp. brought even more attention to the brokerage, which had about 22.5 million funded accounts at the end of June.
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