Warren Wants Robinhood to Explain GameStop Trading Restrictions
(Bloomberg) -- Senator Elizabeth Warren is asking Robinhood Markets Inc. to explain it’s decision to restrict trading in shares of GameStop Inc. and other companies amid a frenzy that pushed shares of the video-game retailer to extraordinary levels.
In a letter dated Tuesday, the Massachusetts Democrat asked Robinhood Chief Executive Officer Vladimir Tenev to disclose whether the restrictions might have been influenced by talks with hedge fund investors or financial services partners, including Citadel Securities. She also sought assurances that Robinhood is meeting regulatory requirements and contractual obligations to retail customers.
”In addition to putting customers’ finances at risk, Robinhood’s actions revealed a new set of questions about its relationship with large hedge funds and other financial institutions, and follows past criticisms of Robinhood’s insufficient investor protections,” Warren wrote. She asked that the company respond by Feb. 9.
Warren and some other lawmakers have joined retail investors behind the surge in GameStop shares in questioning whether Robinhood imposed the trading curbs in coordination with Citadel Securities, the market maker that is one of the trading platform’s biggest sources of revenue.
Both Robinhood and Citadel have flatly denied any coordination or wrongdoing.
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