Robinhood pays $45M to settle SEC violations over reporting and cybersecurity missteps
Home News Robinhood pays $45M to settle SEC violations over reporting and cybersecurity missteps

Robinhood pays $45M to settle SEC violations over reporting and cybersecurity missteps

by Raymond Vandervort

Robinhood pays $45M to settle SEC violations over reporting and cybersecurity missteps

Robinhood pays $45M to resolve SEC violations over reporting and cybersecurity missteps

Robinhood pays $45M to resolve SEC violations over reporting and cybersecurity missteps Robinhood pays $45M to resolve SEC violations over reporting and cybersecurity missteps

Robinhood pays $45M to resolve SEC violations over reporting and cybersecurity missteps

The penalties comes as Robinhood's crypto segment experiences vital shopping and selling exercise and growth.

Robinhood pays $45M to resolve SEC violations over reporting and cybersecurity missteps

Quilt artwork/illustration through CryptoSlate. Image entails blended verbalize material that also can encompass AI-generated verbalize material.

Robinhood has agreed to pay $forty five million in civil penalties to resolve prices of securities law violations.

In accordance to a Jan. 13 assertion, this settlement follows an investigation by the US Securities and Exchange Charge (SEC) into the activities of its subsidiaries, Robinhood Securities LLC and Robinhood Financial LLC.

The penalties encompass $33.5 million from Robinhood Securities and $11.5 million from Robinhood Financial.

The breaches

In accordance to Sanjay Wadhwa, Performing Director of the SEC’s Division of Enforcement, Robinhood’s screw ups spanned a whole lot of severe areas, in conjunction with wrong reporting, heart-broken cybersecurity measures, and insufficient fraud prevention.

Wadhwa acknowledged:

“Today’s account for finds that two Robinhood corporations didn't stare a expansive array of mighty regulatory requirements, in conjunction with failing to accurately mutter shopping and selling exercise, alter to short sale concepts, submit neatly timed suspicious exercise experiences, shield books and files, and safeguard customer files.”

The SEC stumbled on that these corporations didn't conform with hundreds of regulatory requirements from 2019 to 2022. Amongst the violations had been delays in investigating and reporting suspicious transactions between January 2020 and March 2022.

Additional breaches included failing to enforce sufficient protections in opposition to id theft from April 2019 to July 2022. A cybersecurity weakness, which endured from June to November 2021, moreover led to unauthorized obtain entry to to customers’ files.

The corporations had been additional accused of no longer striking forward sexy files of digital communications, a key regulatory requirement.

Robinhood Securities confronted additional scrutiny for elements connected to fractional share shopping and selling, stock lending practices, and screw ups in regulatory reporting. To tackle these problems, the firm agreed to certify that it has conducted measures to forestall identical violations.

Each and each entities admitted to the SEC’s findings and agreed to be reprimanded. They moreover dedicated to conducting an interior overview to make stronger digital communications compliance.

Robinhood crypto

Even though the most recent SEC account for would now not implicate Robinhood’s crypto operations, the firm faces regulatory challenges. Most practical year, the firm disclosed receiving a Wells sight from the financial regulator, signaling doable enforcement motion.

Robinhood’s 2024 mutter finds vast exercise in its crypto segment. As of November 2024, the platform recorded $119 billion in crypto shopping and selling volume and managed $38 billion in digital property below custody.

The firm moreover published that it expanded its crypto offerings within the US, adding tokens like Solana and Cardano, which pushed the entire sequence of on hand digital property within the jam to twenty.

Mentioned listed here
Posted In: US, Regulation
People were interested in these podcasts
Play Episode
36min
CryptoSlate SlateCast
Decentralizing AI infrastructure with Gaurav Sharma, CTO of io.net
In a recent SlateCast episode, Gaurav Sharma, CTO of io.net, joined CryptoSlate’s Editor-in-Chief Liam “Akiba” Wright and CEO Nate Whitehill to discuss io.net’s groundbreaking approach to decentralized infrastructure for AI. With a background at tech giants like Binance and Amazon, Sharma brings deep expertise in scaling technology to a decentralized platform. io.net is paving the way for a decentralized ecosystem that aims to democratize access to AI resources, reduce costs, and enable greater innovation.The Vision Behind io.netSharma explained io.net’s role as a Decentralized Physical Infrastructure Network (DePIN) that leverages community-powered hardware.“Our inventory comes from the community,” Sharma noted. “We don’t own our hardware; we aggregate it from individuals, data centers, and companies.”This model drastically reduces user costs compared to centralized giants like Amazon Web Services (AWS).He highlighted the efficiency of this model:“For instance, an H100 GPU on a centralized platform might cost eight times more than what we offer. Our decentralized model empowers startups by cutting costs and enabling them to allocate resources toward innovation.”Challenges in Decentralized AI InfrastructureBuilding a decentralized AI system presents unique challenges. Sharma emphasized the need for robust distributed systems, scalability, and transparency.“Decentralized infrastructure cannot rely on monolithic tech stacks,” he explained. “The team must excel at distributed systems and computational fundamentals.”Moreover, latency sensitivity and scalability were critical from day one, as io.net’s users often come from high-demand enterprises. Sharma also stressed the importance of trust and transparency in the crypto ecosystem.“Our block explorer showcases every aspect of our network, from GPU availability to revenue metrics. Transparency is the foundation of trust,” he said.Empowering Developers Through TokenomicsOne of io.net’s core innovations is incentivizing co
CryptoSlate SlateCast
Mark Yusko discusses Metaplanet Bitcoin buys and BTC’s future
In a recent SlateCast episode, Mark Yusko, CEO and co-founder of Morgan Creek Capital Management, joined host Liam “Akiba” Wright and CryptoSlate Senior Analyst James Van Straten to discuss Bitcoin’s future, market manipulation, and the evolution of money.Yusko shared insights on Bitcoin’s value proposition, the impact of ETFs, and the broader implications of crypto adoption.Bitcoin’s Value and Price PredictionsYusko explained his prediction of Bitcoin reaching $250,000 in the coming years, basing it on the total value of the Bitcoin network. He stated:“If it’s going to replace gold, the value of gold globally is about $12 trillion. Half of that doesn’t really count… The monetary value of gold, the bars that sit in central banks, that’s about $6 trillion.”He further elaborated on the four-year cycle driven by Bitcoin halving events, suggesting that the fair value of Bitcoin doubles with each halving. Yusko predicted that the current cycle could see Bitcoin reach $100,000 as fair value, potentially reaching $1 million in the next cycle.Market Manipulation and Price SuppressionThe discussion touched on market manipulation, with Yusko drawing parallels between Bitcoin and gold markets. He argued that both are subject to price suppression:“The Rothschild Bank in London, which sets the price of gold globally, has been fixing that price through this manipulation of the futures market for years.”Yusko expressed concern about applying similar tactics to Bitcoin, particularly with the introduction of ETFs and the growth of the futures market.The Evolution of Money and Financial SystemsYusko provided a historical perspective on the evolution of information dissemination and financial systems. He argued that Bitcoin and blockchain technology represent the next significant shift:“We’re about to bust the oldest monopoly in the world left, which is financial services. Banking, right? Banking was started back in the 1100s by the Portuguese monks, the Knights Templar, and it has em
CryptoSlate SlateCast
Markus Maier unveils the power of reallocation in crypto ecosystems
The latest episode of CryptoSlate's SlateCast podcast welcomed Markus Maier, CEO and Founder of Nudge, and CryptoSlate's Editor-in-Chief Liam “Akiba” Wright and CEO Nate Whitehill. The episode highlighted Nudge's unique approach to decentralizing and optimizing liquidity reallocation across multiple DeFi protocols. With a focus on user-centric incentives and cross-chain liquidity, Nudge aims to transform the traditional airdrop model, offering a more efficient and purposeful method for incentivizing users.What is Nudge?Nudge introduces an innovative approach to liquidity management in decentralized finance (DeFi) through reallocation-based incentives. Unlike traditional airdrops, which often result in minimal user engagement and "mercenary" behavior, Nudge's reallocation model rewards users for meaningful, on-chain actions.Markus Maier described Nudge as a system that’s focused on "driving liquidity where it's needed most". By encouraging users to reallocate their assets to protocols that require liquidity, Nudge aims to create a more active and dynamic DeFi ecosystem."Instead of airdrops rewarding passive holders, we’re rewarding users who actively engage with protocols in a way that benefits the entire system," Maier explained.This shift represents a fundamental departure from the status quo. Rather than distributing tokens broadly to anyone holding an address, Nudge's system ensures that only users who take productive, measurable actions receive incentives.The Flaws of Traditional AirdropsTraditional airdrops have long been a controversial mechanism in DeFi. While they aim to attract users and build loyalty, the outcome often falls short. Recipients of airdropped tokens frequently sell them immediately, causing price volatility and minimal engagement with the underlying protocol.Addressing this issue, Maier stated,“Airdrops are a blunt tool. They're expensive and largely ineffective at driving long-term engagement.”This inefficiency led to the development of Nudg
CryptoSlate SlateCast
Bill Miller IV shares his insights on value investing and Bitcoin
In a recent episode of SlateCast IRL, CryptoSlate Senior Analyst James Van Straten sat down with Bill Miller IV, the Chief Investment Officer & Portfolio Manager of Miller Value Partners. The discussion touched upon a variety of topics, from the principles of value investing to the burgeoning world of Bitcoin and cryptocurrencies.The Legacy of Value InvestingBill Miller IV provided insights into the principles of value investing that his family has long championed. He explained:“We look for undervalued companies or ideas and try and buy them in an effort to outperform an index. We’ve been doing this as a family for a very, very long time.”Miller highlighted his father’s remarkable achievement of beating the market for 15 consecutive years, a record he aspires to emulate. This long-term approach focuses on identifying stocks trading at a discount to their intrinsic value, a philosophy that extends to Miller’s views on Bitcoin.Bitcoin’s Unique PositionWhen discussing Bitcoin, Miller highlighted several key aspects that distinguish Bitcoin from other cryptocurrencies:“I think when you just take a step back and think about the technology objectively within the landscape of crypto, the asset has several things that really set it apart from the rest of the crypto landscape.”He emphasized three key aspects that differentiate Bitcoin:Causal Ambiguity: The unknown creator adds to its mystique and wide acceptance.First Mover Advantage: Bitcoin’s early establishment has created a robust ecosystem around it.Proof of Work Mechanism: This secures Bitcoin uniquely compared to other assets.Investment Strategies and ETFsMiller Value Partners has been at the forefront of integrating Bitcoin into its investment strategies. Although they do not offer a Bitcoin-specific ETF, their broad mandate, ETF includes substantial investments in Bitcoin-related stocks. Miller elaborated:“One of the reasons we are doing as well as we are right now is because we have been investing in Bitcoin-relate

Source credit : cryptoslate.com

Related Posts