Retail trading platform Robinhood is set to pay up to $10.2 million in penalties for operational and technical failures that harmed investors, according to a Thursday announcement from a California regulator.
The California Department of Financial Protection and Innovation (DFPI) has joined the multi-state settlement, which followed a North American Securities Administrators Association (NASAA) investigation into Robinhood platform outages in March 2020.
“In addition, prior to March 2021, there were 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 that in some cases left Robinhood users unable to process trades even as the value of certain stocks was dropping,” the DFPI said.
Source: Robinhood Faces $10.2M Penalty From Multiple U.S. States Over Technical Failures, Investor Harm
