Alex’s parents, Dan and Dorothy Kearns, said their son was unable to receive adequate support from customer services before his suicide. The complaint states that 20-year-old Alex Kearns was led to believe he had fallen $730,000 in debt when he took his life in June. Related Story: Investing with Robinhood: The Allure and Controversyįor more information on technology law, see our Technology & Data Legal Services and Industry Focused Legal Solutions pages (including blockchain technology and cryptocurrency).The family of a 20-year-old man who committed suicide last year have sued trading app Robinhood over his death. Is now the defendant in a wrongful death lawsuit andīecause its ease of use has drawn criticism and claims that it allows inexperienced users to engage in trading without the proper experience or education. Must answer to Congressional hearings regarding its decision to stop trading of specific stocks Robinhood currently finds itself embroiled in two major controversies because it: While the lawsuit is still pending, Robinhood has since included new criteria and requirements for customers seeking to participate in advanced trades. For example, at the time of his death, Kearns did not understand enough about trading to realize that the negative balance in his account did not truly reflect any sort of debt that he owed. In general, the Kearns family alleges that Robinhood markets itself towards millennials that may be too inexperienced and too immature to grasp the real-world risk and consequences that accompany high-risk trading. The Kearns family also alleges that Robinhood failed to provide sufficient customer support and investment guidance because Kearns was unable to contact the company for help after discovering his negative balance. In the suit filed by the family of deceased college student Alex Kearns, the family accused the app of being liable for his suicide because it specifically targeted and lured inexperienced investors into using its app by making its platform similar to videogames and removing typical barriers to trading by providing most of its services for free. Last summer, after seeing a negative balance of $730,000 in his trading account a college student committed suicide, after he mistakenly believed that he owed that much. Robinhood Controversy Related to a Student’s Suicide As such, once Robinhood decided to step in and temporarily suspend trading of GameStop stocks, its actions triggered Congress to scheduling hearings to scrutinize and discuss Robinhood’s intervention. Using Robinhood to conduct trades, due to its policy of fee-free trading, users on Reddit were able to vault GameStop stock up more than 14,300% last week, which later free-fell back down again to $53.50 after Robinhood restricted users from buying certain stocks on its platform. Robinhood first catapulted to headlines with the rise and fall of GameStop stock, which had its price and value manipulated by a group of Reddit users.
Robinhood Controversy Related to GameStop Stock Specifically, Robinhood has found itself embroiled in controversies that involve the premature cessation of GameStop stock trading as well as a wrongful death filed against it. In this post, we discuss the current controversies that surround the trading app. In a previous blog post, we briefly discussed Robinhood’s background and how its entry into the trading section affected its competitors.
The Robinhood Controversies: Congress Scrutinizing GameStop Trading and Wrongful Death Lawsuit Filed
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