Crypto Opinions & News Robinhood's Crypto Unit Hit with $30M Fine over Security, Anti-Crime Misses

[upnorth]

Content source

https://www.theregister.com/2022/08/02/robinhoods_crypto_penalty/

Robinhood's cryptocurrency operations has been formally fined $30 million for violating New York's anti-money-laundering and cybersecurity regulations.

According to the US state's Department of Financial Services on Monday, Robinhood Crypto didn't hire sufficient staff and didn't invest in other resources for its anti-money-laundering and cybersecurity compliance programs. A subsequent investigation found Robinhood's transaction monitoring system had "significant deficiencies," and it didn't sufficiently train its employees, the watchdog noted. Despite these failings, the financial firm "improperly certified compliance" with New York's transaction monitoring and cybersecurity rules, according to the department. Robinhood also, it is said, failed to comply with some consumer protection requirements by not maintaining a dedicated phone number on its website and violated some reporting requirements.

The $30 million fine comes a little more than a year after another watchdog hit Robinhood with a $70 million bill for causing investors to lose millions of dollars due to misleading financial information and system outages. In June 2021, the US Financial Industry Regulatory Authority ordered the biz to cough up $57 million in fines plus pay back $12.6 million to customers to cover their losses with interest. That year, Robinhood recorded $1.8 billion in revenues, up 89 percent in 2020, which it managed to turn into a $3.7 billion net loss.

Robinhood's crypto unit hit with $30m fine by New York

And just lays off about a quarter of staff

www.theregister.com

 

[upnorth]

Trading platform Robinhood is cutting nearly a quarter of its staff due to high inflation and the falling cryptocurrency market.

The company said the economic climate had reduced trading activity, which had boomed at the height of the pandemic. The move comes after the firm reported quarterly revenues of $318m (£260m), 44% down on $565m a year earlier.

Robinhood cuts nearly a quarter of staff as crypto dives

The trading platform, which is popular with amateur investors, reported a large drop in revenues.

www.bbc.com