Robinhood, the stock trading app that was subject to a record fine Wednesday, announced it intends to go public Thursday.
The company also said it is under investigation by a series of regulators, state attorneys general, the SEC, and the U.S. Department of Justice in proceedings associated with the trading restrictions; the company said its CEO Vladimir Tenev has also had his cell phone seized by federal attorneys.
In January, Robinhood restricted the purchase of GameStop, AMC, and other "meme" stocks because the app literally did not have enough money to comply with regulations that require a certain amount of liquidity from companies that allow for stock trading.
This restriction correlated with a days-long dive in the stock prices of GameStop, which skyrocketed in January and February and led to widespread calls from lawmakers, traders, and Redditors on the WallStreetBets subreddit to investigate Robinhood.
In its filing, Robinhood states that the fallout from these restrictions still have the potential to be disastrous for the company.
“We have become aware of approximately 50 putative class actions … relating to the Early 2021 Trading Restrictions.
Also, a related search warrant was executed by the USAO to obtain Mr. Tenev’s cell phone.”. »