Robinhood pays US$65M to end a key probe, but others fester
Robert Schmidt, Bloomberg News VIDEO SIGN OUT
Robinhood Markets will pay US$65 million to settle allegations that it failed to properly inform clients it sold their stock orders to high-frequency traders and other firms, putting a major compliance headache behind the brokerage even as new ones emerge.
The Securities and Exchange Commission fine stems from Robinhoodâs decision to removed disclosures from its web site that detailed how it made money, the regulator said in a Thursday statement. The brokerage known for its immensely popular smart-phone app that offers commission-free trading hid from 2015 to late 2018 that its biggest source of revenue was funneling orders to Wall Street titans including Citadel Securities and Two Sigma Securities.
Weekly Focus:
Digital Asset ‘Stacks’ Plans 2.0 Launch as Non-Security
Secretary Mnuchin Emphasizes G7 Coordination on Digital Currencies
CFTC and SEC Leaders to Step Down
DOJ Indicts ICO Promoter for Tax Fraud, SEC Files Civil Suit
France Strengthens Anti-Money Laundering (AML) Requirements for Digital Asset Companies
Thailand Plans to Incorporate Blockchain into Tax Revenue Collection Systems
U.S. Developments
Members of Congress Request SEC Clarity On Digital Securities Custody
On December 9, a bipartisan group of representatives penned a letter to SEC Chairman Jay Clayton regarding the issue of broker-dealer custody of digital securities. In the letter, the representatives encouraged the SEC and FINRA to address digital asset custody in light of recent interpretive guidance from the Office of the Comptroller of the Currency (OCC) clarifying that national banks may provide custody services for digital assets.
SEC Director of Division of Trading and Markets Brett Redfearn to Depart Redfearn, who led the SEC’s Division of Trading and Markets, which was responsible for ensuring firms remain in compliance with Reg BI, will leave the agency by year’s end.
Brett Redfearn, the director of the Securities and Exchange Commission’s Division of Trading and Markets, will be leaving the agency by the end of the year. He’s the latest executive at the SEC to announce that they will be vacating their post by year’s end, including Chair Jay Clayton.
“It has been a tremendous honor and privilege to lead this division during a period that included incredibly challenging times for markets, investors, and the economy,” Redfearn said.
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