12/19/2023 0 Comments Rocket stock wallstreetbets![]() “Robinhood continues to randomly pull other securities from its app for no legitimate reason,” the complaint states.Ī hashtag once devoted to spreading baseless conspiracy theories about the 2020 election has now been taken over by investors fuming over the decision by online brokerages to restrict trading of shares of GameStop and other volatile stocks. The company took similar actions for other stocks, including AMC ( AMC), BlackBerry ( BB), Nokia ( NOK) and others, something the suit also takes issue with. Robinhood said in a statement Thursday that, “in light of recent volatility, we are restricting transactions for certain securities to position closing only.” “Upon information and belief, Robinhood’s actions were done purposefully and knowingly to manipulate the market for the benefit of people and financial institutions who were not Robinhood’s customers,” the complaint, filed by Brendon Nelson, alleges. It also alleges that Robinhood customers have endured “substantial losses” because of the move, and claims the trading platform violated Financial Industry Regulatory Authority rules by denying users the opportunity to trade the stock. The complaint alleges that Robinhood’s action deprived users of taking advantage of potential gains as GameStop’s stock rose later in the day, as well as making it impossible for them to “short” the stock in case it drops. One Robinhood user alleged in a class action lawsuit filed against the trading platform Thursday that the move was made "knowingly to manipulate the market for the benefit of people and financial institutions who were not Robinhood’s customers."Ī Robinhood user filed a class action lawsuit against the platform on Thursday after it restricted trading of GameStop ( GME) stock - which has soared in recent weeks thanks to the support of Reddit traders - causing it to lose much of its value today. Tenev also shot down speculation spread on social media Thursday that Robinhood restricted regular trading of the volatile stocks at the request of large Wall Street firms. He added: "In order to protect the firm and protect our customers, we had to limit buying in these stocks." a lot of concentrated activity in these names that have been going viral on social media." He added that such requirements can fluctuate based on market volatility and can be "substantial in the current environment where there’s. "We have lots of financial requirements, including SEC net capital requirements and clearinghouse deposits - that’s money that we have to deposit at various clearinghouses," Tenev said. He said the decision was made in response to requirements Robinhood must adhere to as a brokerage firm. ![]() Robinhood CEO Vlad Tenev explained what he called the platform's "very difficult decision" to restrict buying of GameStop ( GME) and about a dozen other securities during a Thursday evening interview on CNBC. ![]() ![]() Robinhood CEO Vlad Tenev speaks during a conference in 2018 in New York. ![]()
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