By Hannah Erin Lang
Two brokerage units of Robinhood Markets have agreed to pay $30 million to settle an investigation by the Financial Industry Regulatory Authority into a range of violations, some of which date back more than a decade.
Finra, Wall Street's self-regulator, found violations related to anti-money laundering programs, disclosures and clearing system supervision at Robinhood Securities and Robinhood Financial, the regulator said in a release Friday. Robinhood neither admitted nor denied wrongdoing.
"We are pleased to resolve these historical matters, many of which date as far back as 2014, and which Robinhood Securities and Robinhood Financial have since remediated," Erica Crosland, Robinhood's associate general counsel said in a statement.
Robinhood agreed to pay $3.8 million in restitution to customers affected by a policy known as order collaring, which occasionally prevented some users' trades from being executed. Robinhood ceased that practice in 2023.
Finra also said that Robinhood failed to reasonably supervise its clearing technology system, which regulators say contributed to the problems the brokerage faced in January 2021, at the height of the meme stock trading frenzy.
Friday's settlement is the latest in a string of penalties paid by Robinhood as it has evolved from a disruptive startup into a more established financial firm.
Last month, Robinhood said the Securities and Exchange Commission dropped an investigation into its crypto unit.
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(END) Dow Jones Newswires
March 07, 2025 17:14 ET (22:14 GMT)
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