Robinhood Faces $45M SEC Penalty for Regulatory Violations
Robinhood has agreed to pay a $45 million civil penalty to the U.S. Securities and Exchange Commission (SEC) for violating multiple securities regulations. The settlement involves Robinhood Securities LLC and Robinhood Financial LLC, the latter of which admitted certain findings in the SEC investigation. The SEC cited failures in maintaining electronic records, promptly reporting suspicious activity and protecting customer information. Additionally, Robinhood was found not to comply with rules against abusive short selling and had unaddressed cybersecurity vulnerabilities. Robinhood Securities will pay $33.5 million and Robinhood Financial will pay $11.5 million, with a payment deadline of January 27. Despite the penalty, Robinhood’s stock suffered minimal impact, reflecting the resilience of investor confidence.
