Online stock-trading platform Robinhood is facing a wave of regulatory scrutiny, including several investigations by authorities concerning its options-trading practices and outages its platform suffered last year. Two of its subsidiaries are in settlement talks with the Financial Industry Regulatory Authority (FINRA) related to these probes.
According to a regulatory filing Friday, Robinhood Financial (RHF), a wholly owned subsidiary of Robinhood Markets, and Robinhood Securities (RHS) are engaged in discussions with FINRA staff regarding a “possible negotiated resolution of certain FINRA matters.” The outages being probed occurred in March 2020 and prevented customers from placing trades. “RHF and RHS anticipate that any resolution, if reached, would involve charges of violations of FINRA rules, a fine, customer restitution, a censure, and a compliance consultant,” the company said.
