Skip to comments.Robinhood Financial fined $65 million by SEC for misleading users
Posted on 01/30/2021 9:19:10 AM PST by Navy Patriot
Robinhood Financial has been fined $65 million for misleading its stock market customers about how the company makes its revenue from their trades, the Securities and Exchange Commission said Thursday. The SEC fine comes one day after regulators in Massachusetts filed a lawsuit against Robinhood for allegedly targeting young, inexperienced investors with flashy gimmicks on its app that treat stock investing like a game.
(Excerpt) Read more at cbsnews.com ...
When does _somebody_, _anybody_ go to jail for fraud?
Old news, over a year ago. It had to do with disclosures about funneling the trades to select HFTs who gave them a kickback.
They just changed the fine print disclosures, (which no one reads anyway,) and they were good to go.
SEC should shut down naked shorts.
This whole story is wrong. Redit and Robinhood don’t have enough money behind them to cause this situation. There is a much bigger player in the market. Someone like China, could be attacking our market and our short sellers by coordinating an attack on a few stocks. You need Billions of dollars to cause this situation. If ten thousand little guys throw a thousand dollars at this, they don’t make a dent. Trust me, there has to be a large player here. And the feds can figure out who that player is.
“””Robinhood takes a user’s stock order and sells it to a larger trading firm that executes the trade, a process known as “payment for order flow,” the SEC order states.
Robinhood made no mention of payment for order flow rates, federal regulators said, at a time when the company was rapidly growing. While Robinhood markets its services as “commission free,” the SEC claims that customers in reality received inferior trade prices”””
OK SEC, if you are going to fine Robenhood $65 million for this practice, then you also better start fining the many other brokerage firms who have ZERO commission fees.
65 Million to these white liberal ‘elite’ crooks is like five bucks for me. It’s NOT even a slap on the wrist.
Or maybe it really is a case of the hobbits ( remember that term?) having figured out how to game the Orc’s own game, so now Stzrok’s wife, Sauron , newly appointed dark lord of the SEC, is striking back.
While there are lots of little guys throwing a few thousand around there were a lot of big daytraders in there. One guy threw in $200k to buy about about 28,000 shares at $7 a piece.
While I doubt they could have held the line originally the press hype made the whole thing snowball and got everybody in (including Elon Musk and Mark Cuban who are throwing in a few millions for the lol’s)
And this is ultimately the hedge fund’s fault as they had sell contracts for something like 130% of the AVAILABLE SHARES! That meant they planned on churning the stock which made it easier for the Reddit WSB guys to corner the market and setup a mini monopoly.
“”” process known as “payment for order flow,””””
Also, the way to avoid being scammed by the above process by the brokerage firms is to place ‘limit’ orders when you buy or sell.
When a person places a ‘market’ order to buy or sell, they are subject to the brokerage firm buying at the highest price offered or selling at the lowest price offered.
I believe shorts should require reasonable cash deposits up front.
Old news, small fine...they likely knew they’d get the fine and priced it in in advance.
“””I believe shorts should require reasonable cash deposits up front”””
Such is the case for an individual investor. If you short a stock, the brokerage firm will require that you have enough assets in your account to cover any margin calls on the shorted stock.
How did I miss the point?
Mets owner, Steve Cohen maybe
Mets owner, Steve Cohen maybe
But playing the stock market is a game.
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