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Robinhood intends to go public on Thursday, Even as it is being widely investigated over its role in January’s GameStop bonanza

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the staff of the Ridgewood blog

Washington DC, Robinhood says it is being widely investigated over its role in January’s GameStop bonanza; is subject to at least 49 class action lawsuits. Robinhood still intends to go public on Thursday. The company is subject to at least 49 class-action lawsuits over its restriction of the purchase of GameStop stock in January. It is under investigation by a series of regulators, state attorneys general, the SEC, and the US Department of Justice. The company’s CEO had his cell phone seized by federal attorneys. Robinhood acknowledges that the fallout from its restrictions has the potential to be disastrous for the company.

Redditors are pledging to avoid Robinhood’s IPO, even as the company goes out of its way to lure day-trader interest.

Robinhood is a commission-free trading app, much of its revenue comes from payment for order flow, which is the compensation brokerages like Robinhood earn by having third-party firms execute customer orders. In its S-1 filing, the company said four market makers accounted for 59% of the revenue as of the end of March, with Citadel alone making up 27%.

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