The North American Securities Association (NASAA) has recently announced that Robinhood Financial, the payment platform, has reached a settlement agreement with investors and has agreed to compensate for the damages caused by operational errors and technical failures.
According to NASAA officials, Robinhood has agreed to pay a total of $10.2 million in fines to investors in Delaware, New Jersey, South Dakota, and Texas.
This investigation was initiated after a surge in complaints from Robinhood users about the platform’s poor quality, which led to systematic failures in processing transactions, resulting in a significant loss of funds.
A supervisory review revealed that Robinhood had deficiencies in its options and margin account processing processes, as well as deficiencies in the firm’s monitoring and reporting tools before March 2021.
Despite Robinhood’s repeated violation of customer service policies, the agreement ensures that Robinhood will now take its obligations more seriously and correct the deficiencies, according to NASAA President Andrew Hartnett.
Meanwhile, the US Securities and Exchange Commission (SEC) has also sent a request for information to Robinhood regarding the placement of cryptocurrencies for trading and measures taken by the platform for the safe storage of assets.