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- Robinhood, a trading app fined US$30 million
- The company is already in a loss of $295 million
On Tuesday, the department of Financial Services, New York fined US$30 million on Robinhood, a trading app. The company got fined for disobeying the bank secrecy act, anti-money laundering, and cybersecurity laws.
The superintendent of the New York Department of Financial Services, Adrienne A. Harris says “ With the growing business, the company was not able to properly invest the resources in order to build and back the culture of consent. This thing resulted in the disobedience of the anti-money laundering and cybersecurity laws of the Financial services department.
All cryptocurrency companies belonging to New York are bound to that very law of anti-money laundering, consumer protection, etc of the department. The department will be investigating and taking steps when the licensee is found guilty, the superintendent further added.
The financial regulator said that the company inappropriately certified compliance with the transaction monitoring and cybersecurity law of the Department. The company continuously violated the rules by claiming compliance.
The regulator declared that the company failed to protect the consumer requirement and also it did not keep a different phone number for the purpose of consumer complaints.
23 percent of employees will be eliminated
The company must keep an individual consultant as advised by the regulator, which will help in checking out whether the company is taking the correct steps for describing its violations and deficiencies under the agreement.
The company has publicized that it is eliminating nearly 23 percent of employees because of record inflation and cryptocurrency breakdown. This is the second round in this very year when the company will be eliminating its employees.
Robinhood disclosed its plan for elimination when it issued its earnings for Q2 in 2020. Currently, the company is at a loss of about $295 million and has seen a reduction of 1.9 million monthly active users.
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