--- title: "Robinhood Paying $70 Million Fine For Being Absolutely Terrible" description: "Investing platform Robinhood has agreed to pay a fine of nearly $70 million to the Financial Industry Regulatory Authority for misleading millions." date: "2021-06-30" modified: "2021-06-30" authors: - name: "Victor Tangermann" job_title: "Senior Editor" link: "https://futurism.com/authors/victor" url: "https://futurism.com/the-byte/robinhood-70-million-fine" categories: - "Finance" - "Future Society" - "Investing" tags: - "dogecoin" - "investment" - "robinhood" - "the digest" --- # Robinhood Paying $70 Million Fine For Being Absolutely Terrible ![Investing platform Robinhood has agreed to pay a fine of nearly $70 million to the Financial Industry Regulatory Authority for misleading millions.]() *\Image: Futurism\* ## Systemic Failures Investing platform Robinhood has agreed to [pay a fine]() of nearly $70 million to the Financial Industry Regulatory Authority (FINRA), a US group tasked with regulating brokerage firms and exchange markets. Why? Basically because Robinhood is really, really terrible at its job. The "financial penalty" was ordered by FINRA due to Robinhood's "systemic supervisory failures and significant harm suffered by millions of customers," according to a [press release]() that called the fine the "largest financial penalty ever ordered" by the body. Robinhood has repeatedly given its millions of customers "false or misleading information," caused them to suffer from several system outages, and even approved very risky trades, according to the filing. In short, Robinhood's recent track record has been absolutely abysmal — and customers should probably think twice before signing up. ## Misleading Millions FINRA's investigation found the platform gave out misleading information, including about customers' balances, whether customers could make certain trades, how much buying power they had, or how much risk of loss they faced completing certain transactions. Things got so bad that a 20-year-old customer named Alex Kearns, who died by suicide, was led to believe he had a negative balance of $720,000. As it turns out, he owed only half of that, as [*CNBC* pointed](). ## Constant Outages In a single week in March 2020, [Robinhood experienced three outages]() as US stocks plummeted by historic margins. Then in May of this year, trading [crashed yet again]() while alternative cryptocurrency Dogecoin spiked, causing customers to lose out on huge potential gains. Robinhood also [blocked purchases]() of GameStop, AMC, and BlackBerry stock in January as popular subreddit r/WallStreetBets caused them to go haywire, causing Tesla CEO Elon Musk to [suggest in a *CNBC* interview]() that "something shady" may have gone down. According to the organization, Robinhood customers suffered more than $7 million in total losses doe to "misstatements," and is requiring the platform to "pay more than $7 million in restitution to these customers." The platform's popularity has [unsurprisingly plummeted]() over the last year — despite the best efforts of Google, which [deleted 100,000 negative reviews]() following the Wall Street Bets fiasco in January. But FINRA's fine should serve as a warning to the rest: keep your distance and keep your money away from Robinhood. **READ MORE:** [Robinhood to pay $70 million fine after causing ‘widespread and significant harm’ to customers]() \[*CNBC*\] **More on Robinhood:** *[Robinhood Went Down Yet Again, This Time Due to Dogecoin Spike]()* ## Author I've been at Futurism since 2017, where my role has evolved to encompass design, writing, and increasingly editing. I've always been fascinated by space exploration and advanced transportation, which I've leaned into by interviewing luminaries in those fields while closely following the dimensions of policy and regulation that allow next-generation projects to succeed -- or, sometimes, to fail. I'm also keenly interested in the effects of generative AI on society, policies, and democratic institutions, as well as clean energy, physics and biology, and the vagaries of tech leadership. My work for Futurism has been cited by publications including Ars Technica, Gizmodo, PC Magazine, Jalopnik, Fox News, and the New York Post. I spent my childhood living in locations including Manila, the Philippines, and Geneva, Switzerland, attended McGill University, and now live in Toronto, Canada. Before Futurism I worked at AskMen and a small photography studio. In my free time, I'm an avid gardener, foodie, and craft beer lover, as well as a maker of artisanal hot pepper sauces. I have a magnificent dog named Freida. ### Author social links [Bluesky]()