Robinhood is again being investigated again by regulators

Robinhood is in trouble again with government regulators. The commission-free trading app was in hot water after the New York State financial regulator fined the Robinhood $30 million for alleged violations of anti-money-laundering, cybersecurity, and consumer protection rules.

New York State Department of Financial Services NYDFS said today that Robinhood Crypto did not devote enough resources to address compliance and cybersecurity risks.

According to an order filed Tuesday, NYDFS said that the Robinhood unit must enlist an independent consultant to monitor compliance. The penalty was expected to be paid by the company last year.

As part of the settlement, the New York State financial regulators said that RobinhoodCryptocurrency will be required to retain an independent consultant to evaluate its compliance practices.

Robinhood has been the center of several regulatory investigations over the last two years. As we reported a year ago, the Financial Industry Regulatory Authority FINRA ordered Robinhood Financial LLC to pay $70 million for systemic supervisory failures and false information and outages that harmed thousands of consumers.

We are pleased that the settlement in principle reached last year and was previously disclosed in our public filings is now final, Cheryl Crumpton, associate general counsel for litigation and regulatory enforcement at Robinhood, said on Tuesday.

Robinhood is not new to this type of accusation. In January 2021, a class action suit was brought against Robinhood accusing the trading app of market manipulation. The New York Attorney General Latitia James said at the time that her office was reviewing the Robinhood trading app and activity related to GameStop, as investors sued the firm after it froze stock buys for the games retailer during a major price surge.

We are aware of concerns raised about activities on the Robinhood app, including trading related to the GameStop stock. James said in a statement that we are reviewing this matter.

Robinhood, founded in 2015 by co-founders and Co-CEOs Baiju Bhatt and BTC Bitcoin Cash BCH, offers commission-free trading for several major cryptocurrencies, including Bitcoin Cash BCH, SVBSV Doge coin, DOGE Ether Litecoin and ETC Robinhood, as well as margin and extended hours trading through Robinhood Gold. The platform also provides real-time market data for more than a dozen digital assets. Robinhood currently has over three million users and billions of dollars in transaction volume.