Robinhood to pay record $70M to settle range of allegations:
The financial penalty is the largest ever ordered by the Financial Industry Regulatory Authority (FINRA), a nongovernmental organisation that oversees the United States brokerage industry, and one that “reflects the scope and seriousness of Robinhood’s violations”, said Jessica Hopper, head of FINRA’s department of enforcement.
Since its 2014 launch, Robinhood has shaken up the brokerage industry with zero-commission trading and an easy-to-use app that’s drawn a new generation of investors into the market.
It already has more than 31 million customers, many of whom were earlier getting left behind as the stock market rose without them. But it’s also faced criticism and penalties from a range of regulators over allegations that it encouraged novices to make trades too risky for them and hurt them in other ways.
Robinhood neither admitted nor denied the allegations in the settlement announced Wednesday. In a blog post, Robinhood detailed how it has improved support for its customers, including offering the ability to call in and talk with a service representative for some issues.
[...] Among the examples cited in FINRA’s settlement was the suicide of a 20-year-old customer last year. A note found after his death said he was confused about how he could have used borrowed money to trade when he thought he had turned off that feature. The day before he died, Robinhood showed the customer that his cash balance was negative $730,165.72, when it was actually negative $365,530.60.
FINRA said he was one of more than 800,000 customers that Robinhood allowed to make certain kinds of trades that could automatically trigger the use of borrowed money, even if they had turned off the ability to trade “on margin”. He was also an example of the more than 135,000 customers to whom Robinhood’s website and mobile app gave inaccurate numbers for their cash balances from December 2019 to June 2020.
Previously:
The Complete Moron’s Guide to GameStop’s Stock Roller Coaster
Stock Trading Firm Robinhood Stored User Passwords in Plaintext
Related Stories
Submitted via IRC for Bytram
Stock Trading Firm Robinhood Stored User Passwords in Plaintext
Robinhood, a California-based financial services company that provides a popular commission-free stock trading app, informed some users that their passwords were stored in plaintext.
"When you set a password for your Robinhood account, we use an industry-standard process that prevents anyone at our company from reading it. On Monday night, we discovered that some user credentials were stored in a readable format within our internal systems. We wanted to let you know that your Robinhood password may have been included," the company told impacted customers.
Robinhood says it has addressed the issue and claims to have found no evidence that the exposed passwords have been accessed by anyone outside its response team. However, "out of an abundance of caution," impacted users have been advised to change their passwords.
The company has not shared any technical details on the incident and it has refused to disclose the exact number of impacted users.
The financial services firm discovered the password issue on the same day it raised $323 million. The latest funding round valued the company at $7.6 billion.
The Complete Moron’s Guide to GameStop’s Stock Roller Coaster
The Complete Moron’s Guide to GameStop’s Stock Roller Coaster:
Last week, an epic short squeeze had driven GameStop stock up to $40 a share, a roughly 1,500 percent increase from its low point nine months ago. Little did anyone know at the time that this would only be the beginning of the story.
As I write this, GameStop's stock price is hovering around $350, up another 775 percent or so since I wrote about this situation eight days ago. By the time you read this, that number may be horribly outdated, as the stock continues to bounce up and down with extreme volatility hour by hour (it dipped down as low as $61 and peaked as high as $159 on Friday).
The current stock price now gives the company a market cap of about $26 billion.
On the surface, that means the market currently thinks GameStop is worth more than twice as much now (during a potentially existential threat to brick and mortar game sales) as it was during the height of the Wii boom in late 2007, when console game downloads were barely a thing.
Also at: Business Insider.
Melvin Capital, Hedge Fund Targeted by Reddit Board, Closes out of GameStop Short Position
Melvin Capital, hedge fund targeted by Reddit board, closes out of GameStop short position:
Robinhood Trading Platform Data Breach Hits 7M Customers:
The cyberattacker attempted to extort the company after socially engineering a customer service employee to gain access to email addresses and more.
Investor trading app company Robinhood Markets has confirmed a data breach that affects the personal information of about 7 million customers – roughly a third of its user base. A cyberattacker made off with emails and more, which could lead to follow-on attacks for Robinhood customers.
The trading platform, which found itself in the middle of the infamous GameStop stock price run-up in January, acknowledged that the breach was a result of a system compromise that occurred on Nov. 3. The company said that the adversary was able to target an employee to gain access to sensitive company systems. After that, the perpetrator attempted to extort the company, demanding payment in return for not releasing the stolen data.
"The unauthorized party socially engineered a customer-support employee by phone and obtained access to certain customer support systems," Robinhood said Monday in a statement. It added, "After we contained the intrusion, the unauthorized party demanded an extortion payment. We promptly informed law enforcement and are continuing to investigate the incident with the help of Mandiant, a leading outside security firm."
For 5 million of the victims, the cybercrook made off with email addresses. For 2 million of them, the attacker also absconded with full names. Meanwhile, names, birth dates and ZIP codes were stolen for 310 people, and "more extensive account details" were heisted for 10 more, the company said.
(Score: -1, Troll) by Anonymous Coward on Thursday July 01 2021, @03:40AM (17 children)
There is no free lunch, you dumb millenials. This comes from a so-called gen-xer with boomer parents.
(Score: 1, Touché) by Anonymous Coward on Thursday July 01 2021, @04:15AM (1 child)
What does that have to do with anything? This is RH getting slapped for
not reigning in the WSB people hard enoughtaking advantage of small investors with predatory business practices.(Score: -1, Troll) by Anonymous Coward on Thursday July 01 2021, @04:40AM
GME is currently over $200. I don't think WSB is hurting too much from being screwed.
(Score: 2) by fakefuck39 on Thursday July 01 2021, @01:55PM (14 children)
From another genX-er - but of course there is. Lots of free lunch for some, taken from others as always. Same as with "forgive student debt" kind of crap. You're generalizing "free" to mean "free" - but free means "free for me" to these retards.
With student loans, they mean - you pay your student loan, then you pay my student loan. See - it's free now. For me. With bitcoin and apestock, it means some of the people will have some free lunch, and others will lose their pants.
The stock is up for a couple of companies. They all bought it lower, but most bought it higher than its actual value. They didn't buy video games or tickets, which would result in revenue and a small ticker increase. They instead bought more hot air to blow into the balloon.
At some point they're all going to start selling, and the stock will drop to its normal market price. Sharply. The few who start the selling wave will take the cash most of them paid in, and most will lose that cash they paid in. So an absolutely free lunch for a few, complete hunger for the rest of them, no condiments for a few rich people who shorted. Most of those with the free lunch will be another set of hedge funds, not the apes.
But they don't see that far ahead. They see it as "I bought at 50, it's at 200, I have 150 in free lunch." To them it's cash already, and they're ignoring that they won't stop playing the game till they lose. Even the few who will make money, will most likely gamble in the future on something else, and won't stop playing till they've majorly lost.
If there's one thing to learn from the boomers, it's this: dump it all into t rowe price blue chip, and forget about it till you need the cash. If you keep playing, over and over, you'll eventually lose. Why? Because you keep playing till you have nothing left to play with. The losses from most are what pays for the free lunch of the few short-term winners, who will at the end also be long-term losers. The only winning move is not to play. You can get 20% average annual long-term growth if you don't play. Max out the roth ira and roth 401k w/ employer match every year. If you got your own business that gets you to 60k/year tax free, if you don't you're at 30k. If you're healthy then get an hsa and max that out w/o using it - that becomes like a 401k when you retire. Get your 20% of tax-free growth, and you're all set.
But let's be honest here. One of the reasons the poor will stay poor is because they want to double their money fast, and they won't stop trying till all their money is gone. Someone smart should start a cool new trend. Yeah, t rowe is a boomer thing, but vigax sounds like vagina, and mgk sound like a techno band - be cool and get you some vagina-techno. It's the trendy new thing to do.
(Score: 2) by Tork on Thursday July 01 2021, @08:36PM (13 children)
... Wow. Just, wow.
🏳️🌈 Proud Ally 🏳️🌈
(Score: 2) by fakefuck39 on Friday July 02 2021, @12:38AM (12 children)
This discussion is literally about "apes" investing their last dime and taking out loans to get GME and AMC - losing all they invested in the long run. They scream they've doubled or tripled their last $200 in a week or two. This is one of the dumbest things you can to do in investing. These people are poor, and this is one of the things keeping them poor - you know, because they play poker w/ their last $200. Not sure what you're not getting here, but not surprised you're not getting it.
Yes sherlock, the poor investing poorly keeps them poor. That somehow gives you a surprised pikachu face? That's because you're an autistic retard.
(Score: 0) by Anonymous Coward on Friday July 02 2021, @12:51AM (11 children)
(this has not happened. both gme and amc are way up.)
(Score: 2) by fakefuck39 on Sunday July 04 2021, @02:46AM (10 children)
(in your virtual world of hand-picked datapoints, to make numbers fit your feelings)
both stocks have gone up and down plenty, and most apes who bought them did not buy at the lowest point. you are making shit up.
if you bought gme in feb, you've lost money now. if you've bought in the middle of march, you've lost money now. if you bought a month ago, you've lost money now. you are a moron.
(Score: 0) by Anonymous Coward on Sunday July 04 2021, @10:27PM (9 children)
I don't get my own personal prices for stock or digital currency values. Thanks for mentioning data points in the plural, though.
> if you bought gme in feb, you've lost money now. if you've bought in the middle of march, you've lost money now. if you bought a month ago, you've lost money now. you are a moron.
Incorrect and frankly... basic.
(Score: 2) by fakefuck39 on Monday July 05 2021, @04:21AM (8 children)
>Incorrect and frankly... basic.
guy in his midlife talking like a teen edgelord and frankly....incel.
yes retard, GME has been higher than it is now many many times. this happens when people...gasp..buy the stock. and those that did, have now lost money.
(Score: 0) by Anonymous Coward on Monday July 05 2021, @05:02AM (7 children)
(Score: 2) by fakefuck39 on Monday July 05 2021, @07:59AM (6 children)
Because you declare it so to fit your feelings, while the 'apes' keep losing their cash and complaining on reddit.
yes, let's believe your made up reality -no one is buying when the stock price goes up. Or, I could keep making my stable average of about 30% a year, invest in real things, and keep laughing at you. You're who I was talking about. The lower middle class. You stay poor because you pretend the situation is whatever fits your feelings, make poor investment choices trying to get 'rich' quick, and lose your shirt at the end. and by 'rich' to you, I mean the lower 6 figures - a downpayment on a mediocre house.
You keep doing you. After all, your only purpose is to entertain me, but doing and saying real dumb shit. Economics degree from blog posts of people like yourself, and you think you know better. That's because your secretly super-low self esteem can't handle the hit that you're a just a clown. Hint: don't get your stock advice or market outlook from teenagers and poor people who call themselves 'apes.' Well, actually, please do, and then tell us about it while mailing your rent check, or applying for a 30 year loan.
(Score: 0) by Anonymous Coward on Monday July 05 2021, @08:18AM (5 children)
Lol, your response is too lazy to be taken seriously. That's just not how stock works. It is funny that you looked it up enough to throw the term "apes" around yet somehow completely MISS who actually has lost money.
(Score: 2) by fakefuck39 on Tuesday July 06 2021, @12:03AM (4 children)
a couple of hedge funds lost money. which does not mean "apes" made money. someone paying penalties on not covering their shorts does not mean that money goes to the people with the stock retard.
a few apes made money, which came from the majority of the apes. those will lose even more money when the bubble they created bursts. you know who made even more money on the apes? other hedge funds.
you are a moron. your investment strategy is "buy into the bubble, hope I'm not the one left holding the stock when it goes back to its actual value." again, you are mentally retarded, and know zero about investing. you've read some paragraph-long snippets online, "analysis" by college freshmen, an mostly, your wishful feelings.
(Score: 0) by Anonymous Coward on Tuesday July 06 2021, @01:02AM (3 children)
So... that also doesn't mean they lost money. See how lazy you were? You got distracted by quickly trying to catch up on the news and you just tripped over your own point! ;)
(Score: 2) by fakefuck39 on Tuesday July 06 2021, @03:10AM (2 children)
Yes yes, in your magic little world of feelings to make yourself feel better, that cash that the people have in their bank account when they sold at the peak magically appeared out of nowhere. I get it. Your conversations and analysis with your reddit-bound peers overrule all real economics.
You are exactly the point I was making. Lower middle class people who will always stay lower middle class. You keep forgetting I'm not here to convince you of anything. I'm just here to laugh at you, while making my consistent 30-35% per year in returns, every single year, for decades gone and decades to come.
The real deal with people like you, is laziness as you've pointed out. You get your education on a subject from other retards like you posting the dumbest shit on reddit, and those hours reading reddit are your education on the subject. What, you're going to invest 100k and 5000 hours to learn about a topic? Nah, you're already an expert. DoucheMcPizza69 on /u/stonkdonk agrees with everything you say!
Here's a fact. You have no Cash reserves. You have no stable stocks. What you have are fake numbers you made up while you're playing with our food money, to convince yourself you're rich.
When people start selling a $20 stock that's inflated to $200, a few will sell at $200. That $200 will come from the people who miss that 1-hour window to bail out. 5 people will get rich, and that money will come from the 5000 who were poor, and now can't pay rent.
It will always stay that way, because you're unwilling to learn - easier to say you already know, from /u/bozoDonkeyDong's "chart," and you'll never listen to people who actually know something (people who do weath management for a living).
Chasing that quick buck, because a buck is all you have. And a buck less soon you will have.
(Score: 0) by Anonymous Coward on Tuesday July 06 2021, @05:00AM (1 child)
So... who's entertaining who? :)
(Score: 2) by fakefuck39 on Wednesday July 07 2021, @12:25AM
I'm entertaining myself, by repeatedly calling you a retard, pointing out how you are a retard after you say retarded things, calling you an incel when you (a middle-aged ugly man) say teen edgelord things, and knowing that you'll never have any actual wealth. That is literally the only reason I pick one of the AC posts and reply to it here, while ignoring the rest. Because I feel like being entertained - so I pick a retard from the bunch. Congratulations, today you've won the clown lottery. Then I keep the thread going, as long as I'm not bored with it. Then once I get bored, I either set a random alnum ksh script to reply to you, or just not read your last reply. Your only purpose here, is entertaining me, while I feel like it. Enjoy you autism, incel.
(Score: 5, Insightful) by Mykl on Thursday July 01 2021, @05:07AM (9 children)
Automatically lending someone money when they have explicitly asked you to not do so sounds like the sort of action that should cost a financial institution their trading license.
The incorrect balances are terrible, but I don't see how any predatory practice / malice could be ascribed to that - just a screw-up.
(Score: 2) by Mykl on Thursday July 01 2021, @06:07AM (3 children)
I'm trying to work out how my post could be modded Flamebait (apart from someone doing it for the lulz). I don't really expect the modder to explain themselves, but it would be helpful if they did assuming there really is something inflammatory and baity in there.
(Score: 2) by FatPhil on Thursday July 01 2021, @06:52AM (1 child)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 0) by Anonymous Coward on Thursday July 01 2021, @09:27AM
Listing user names alongside the moderation scores would go a long way to curtailing such misbehaviour.
(Score: 2) by fakefuck39 on Tuesday July 06 2021, @03:18AM
Why try to explain the actions of an idiot w/ autism? When these people spam every post with a song they wrote asking to downvote someone, or start ranting about a jew conspiracy, do you ask "why" or do you just laugh at them? Then why would the way they mod make any logical sense - it makes sense to them because they have an incurable brain disease, and literally live in a fake reality.
Turn off the showing of scores or block them w/ ublock. You'll feel better. These idiots are only here to laugh at.
(Score: 3, Insightful) by FatPhil on Thursday July 01 2021, @06:46AM (1 child)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 3, Interesting) by Anonymous Coward on Thursday July 01 2021, @09:39AM
Robin Hood is required to go through an official brokerage for all trades. I'm not exactly sure how the legalities work but it allows them to offer trading services to people who wouldn't otherwise be eligible because officially it is Robin Hood doing the trades. They are essentially a front for the brokerage firm rather than an unlicensed competitor.
(Score: 5, Informative) by crafoo on Thursday July 01 2021, @07:43AM (1 child)
I agree. It's not like they are the only game in town either: these Chinese manage to provide a better, less shady no-cost trading platform/app with webull.
Everyone knows how these companies provide you with zero cost trades right? You aren't getting the best market price for each trade you make. Robinhood/Webull floats your trade and bundles it. You pay for each trade, just not in direct fees.
(Score: 2, Insightful) by Anonymous Coward on Thursday July 01 2021, @09:41AM
They also front run you, which really should be illegal for the same reasons insider trading is.
(Score: 5, Interesting) by bradley13 on Thursday July 01 2021, @10:58AM
More than that: this must have been a deliberate decision. And apparently the "borrowing" (if it's not margin, what exactly is it?) must be less than obvious in the interface. So: a deliberate policy decision, deliberately misleading customers - that sounds an awful lot like fraud. I wonder if some executives shouldn't be indicted...
A $70 million fine - that's a trifle - that comes out of petty cash. Let's see the responsible individuals actually held responsible.
Everyone is somebody else's weirdo.
(Score: 0) by Anonymous Coward on Thursday July 01 2021, @04:55PM
i hope they get license or watever it's called to the core holy grail matching engine that traders in vests acctually see in that wall street trading building, without a ton of filter inbetween.
it's like having a port on a switch that is connected "dumb" to a fiber optic that then.goes thru the ocean, instaed of having to go thru a "local isp" that goes thru a "regional isp" that rents those 'em port on the "dumb switch" from another entity that has already bought all ports on the switch from the people acctually owning the physical infrastructure, that is the fiber cable and th building it "lands" in ...
yes, there's delay from your smartphone to robinhood but from their it should be a direct link into a."dumb port" of the matching engine of "the real stock market(tm)". i hope they get it. (cue spidermans "with great power ...". good luck).