The Financial Industry Regulatory Authority has fined the securities of Financial Robinhood and Robinhood to pay a $ 29.75 million combined for alleged violations dating back to 2014, a year after the firm was established.
In a 127 -page document On Friday, Finra detailed various violations alleged by the subjects of the parent company Robinhood Markets Inc., ordering Financial Robinhood to pay $ 3.75 million for return clients and $ 26 million for finishes for behavioral violations.
Robinhood subjects have agreed to pay fines without accepting or denialing the charges; The firms also agreed to prove that they have fixed the issues.
“Today's action reminds FINRA members that compliance with essential regulatory obligations remains critical for the preservation and service of all investors,” Bill St. Louis, the executive vice president of Finra and the head of implementation, said in a statement.
Customer return payments from Robinhood Financial are related to a practice known as “collector” market orders. In these cases, Finra claimed that Robinhood made market orders that were “collected” and then canceled and repeated them for an inferior price.
Finras fines for securities of Financial Robinhood and Robinhood were partly due to allegations not to put strict money laundering programs to capture bad actors, including third -party hackers. Financial Robinhood was charged for not sufficient verification of customer identity when they opened an account.
Both firms were fined not to adequately supervise cleaning technology systems and social media promotions by paid social media impacts. Robinhood's securities were accused of not respecting information on the trading of securities.
“We are pleased to resolve these historical issues, many of which date back to 2014, and which Robinhood Securities and Robinhood have been corrected since then,” said Erica Crosland, Associate General Advisor Robinhood and head of regulatory implementation and investigations, said in a statement sent by email. “Robinhood will continue to democratize finances for the next generation of investors.”
This is not the first time Robinhood has had to be decided by finish, which is overseen by the Insurance and Exchange Commission.
In 2021, Robinhood paid $ 70m for finra To resolve various violations, including that he misled customers with false information and let clients be trading options that might not be appropriate for them.
Robinhood, a member of Finra since 2017, resolved the allegations, but neither accepted nor denied the charges.
In February, Robinhood reported that income more than doubles to $ 1.01 billion in the fourth quarter, partly due to the cryptic market transactions for the US presidential election.
Last week, Robinhood closed in its acquisition of Tradepmr, the provider of RIA technology and custody services, for $ 300 million in cash and shares.