TWarren Seeks Answers From Robinhood Over Trading Limits
Jon Hill, 02 February 2021
Sen. Elizabeth Warren, D-Mass., is calling on Robinhood to more thoroughly explain its decision last week to restrict trading in shares of GameStop and other companies amid a frenzy of retail investor activity, saying the move has raised questions about potential conflicts of interest facing the trading platform.
In a Tuesday letter to Robinhood CEO Vladimir Tenev, Warren described the trading restrictions as an “abrupt” rules change that not only risked hurting Robinhood’s retail investor customers but has also led to concerns about how the platform’s ties to hedge funds and other bigger Wall Street players may have influenced its decision-making.
“The public deserves to know the details of circumstance behind Robinhood’s decision to restrict trading and about other actions that appear to be treating individual investors in an unequal or unfair fashion,” Warren wrote.
The letter is the latest result of Robinhood’s response to last month’s headline-making rallies in stocks of video game retailer GameStop Corp., movie theater chain AMC Entertainment Holdings and a handful of other companies popular with users of Reddit’s WallStreetBets forum, where retail investors banded together in an apparent trading war against short-selling institutional investors.
