Congressman Sean Casten of Illinois’ 6th District questioned Robinhood CEO Vlad Tenev about the stock-trading app’s role in recent alleged market manipulation concerning Gamestop and other tradable assets.
Alex Kearns Suicide
However, it was another incident concerning Robinhood that hit closer to Casten’s district – the death by suicide of 20-year-old Alex Kearns’ who thought he owed $730,000 due to what Casten called “a bug” in the Robinhood system.
“He turned on the app, it said he owed $730,000 that he did not have because of options positions that he thought canceled out, but didn’t appear to,” said Casten. “He called the helpline which was not manned, as we discussed. He sent several panicked emails, three to be precise, did not receive a response.”
Robinhood did eventually respond to Kearns’ emails, but that happened after his death.
Casten Calls Customer Service
As Kearns did last June, Casten then called the Robinhood help line and received an automated message telling him to visit the Robinhood app or website for more information before the call automatically hung up on him.
“This was a gentleman who was 20 years old. Under Illinois law he was not allowed to buy a beer, but he was allowed to take on $730,000 in position and exposure that he did not have the liquidity to cover,” said Casten. “Your mission, Mr. Tenev, is to democratize finance, but the history of financial regulation is to protect people like Alex Kearns from the system.”
Earlier in the hearing, Tenev apologized to the Kearns family, and said the company is looking to expand its customer support call centers.
“I’m sorry to the family of Mr. Kearns for your loss,” Tenev said. “The passing of Mr. Kearns was deeply troubling to me and to the entire company.”
Kearns’ family filed a wrongful death lawsuit against Robinhood last month, saying that Robinhood offers no meaningful customer support to investors.
Naperville News 17’s Casey Krajewski reports.
Video courtesy of U.S. House Committee on Financial Services.
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