Robinhood To Pay As Much As $10.2 Million For Technical Failures
(Bloomberg) -- Robinhood Markets Inc. will pay as much as $10.2 million in penalties for operational and technical failures after an investigation by state securities regulators that was sparked by outages in 2020.
The settlement involves “deficiencies at Robinhood in its review and approval process for options and margin accounts, weaknesses in the firm's monitoring and reporting tools, and insufficient customer service and escalation protocols,” the North American Securities Administrators Association said in a news release Thursday.
“Robinhood repeatedly failed to serve its clients, but this settlement makes clear that Robinhood must take its customer care obligations seriously and correct these deficiencies,” Andrew Hartnett, the association's president, said in the release.
The settlement stems from an investigation by state securities regulators in Alabama, Colorado, California, Delaware, New Jersey, South Dakota and Texas.
“We are resolving this matter with the states and are pleased to put it behind us,” Lucas Moskowitz, Robinhood's deputy general counsel and head of government affairs, said in a statement. “The settlement relates to past issues that Robinhood has since invested heavily in improving, including the launch of 24/7 chat and phone support, expanding our library of educational materials and strengthening the way we supervise our technology.”
--With assistance from Austin Weinstein.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.
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