• Contact Us
  • About Us
  • Privacy Policy
  • Login
Upgrade
Investment.Ceo
ADVERTISEMENT
  • Daily Investment
  • Investment
  • Entrepreneur
  • Wealth
  • Subscribe
  • Courses
No Result
View All Result
  • Daily Investment
  • Investment
  • Entrepreneur
  • Wealth
  • Subscribe
  • Courses
No Result
View All Result
Investment.Ceo
No Result
View All Result
ADVERTISEMENT
Home Investment

Tragedy Of A Student Who Killed Himself Thinking He Owed Robinhood $730k

Robinhood is being sued for the wrongful death of a 20-year-old college student who died by suicide last summer after he saw a negative balance of $730,000 in his trading account and mistakenly believed that was the sum of money he owed.

February 10, 2021
in Investment, Lifestyle, News
0 0
0
Tragedy Of A Student Who Killed Himself Thinking He Owed Robinhood $730k
0
SHARES
98
VIEWS
Share on FacebookShare on Twitter

(CNN Business) – The parents and sister of Alexander Kearns accused Robinhood of luring inexperienced investors like their son to take big risks in sophisticated financial instruments such as the options trading he engaged in — without providing the necessary customer support and investment guidance.

“Robinhood built out its trading platform to look much like a videogame to attract young users and minimize the appearance of real-world risk,” reads the lawsuit filed Monday in California by Kearns’ parents Dan and Dorothy and sister Sydney.

You might also like

Something You May Not Know About The Battles Between Top Tech Giants

Something You May Not Know About The Battles Between Top Tech Giants

2 days ago
10
12 Easy Steps To Become A Good Financial Investment Advisor

12 Easy Steps To Become A Good Financial Investment Advisor

3 days ago
57

In addition to wrongful death, the complaint filed by the Illinois family accuses Robinhood of negligent infliction of emotional stress and unfair business practices. The damages they are seeking will be determined at a later date.”Tragically, Robinhood’s communications were completely misleading because, in reality, Alex did not owe any money,” the lawsuit said.

The tragedy illustrated the potential dangers of the free-trading boom set off in large part by Robinhood, which has enjoyed explosive growth during the pandemic.

Those risks have been further magnified recently with the rise and fall of GameStop, which was catapulted by an army of traders on Reddit. Robinhood sparked outrage last month by temporarily suspending purchases of GameStop (GME) — a controversial step that prompted Congress to schedule hearings.

In a statement, Robinhood explained it has made a series of improvements to its options offering, including by providing guidance to help customers, updates on how it displays buying power and live voice support for customers with open options positions.

“We were devastated by Alex Kearns’ death,” Robinhood said. “We remain committed to making Robinhood a place to learn and invest responsibly.”

‘He was in a complete panic’

ADVERTISEMENT

Kearns, who started using Robinhood when he was a senior in high school, died by suicide in June after placing an options spread trade containing a risk “Alex did not understand,” according to the lawsuit. His Robinhood account reflected a negative cash balance in the amount of $730,000 — far more money than he had, the lawsuit said.

“He was in a complete panic. His panic and desperation grew as he was unable to communicate over a number of hours with anyone at Robinhood,” the lawsuit said, adding that he repeatedly tried and failed to reach out to representatives at the company.Adding to the tragedy, Kearns didn’t realize his massive negative balance would have been erased by the exercise and settlement of options he held, the lawsuit said.

“Robinhood never bothered to explain this to Alex or respond to his increasingly desperate pleas for help,” the lawsuit said.

The family pinned the blame for Kearns’ panic squarely on Robinhood.

ADVERTISEMENT

“This resulted in a highly distressed mental condition in Alex, an uncontrollable impulse to commit suicide as the only option he could see,” they said.

Changes at Robinhood

Before taking his own life, Kearns left a note that signaled his confusion.

“How was a 20-year-old with no income able to get assigned almost $1 million worth of leverage,” the note said, according to the lawsuit, adding that these were his last known written words.

After Kearns’ death, Robinhood’s co-founders wrote that they were “personally devastated by this tragedy” and promised to make improvements to its app.
Robinhood said this week that its changes include new financial criteria and revised experience requirements for new customers seeking to trade advanced options strategies and plans to expand that to other use cases. Robinhood also changed its system to escalate emailed support requests from some options traders.

Tags: Alexander KearnsGameStoprobinhood
ADVERTISEMENT

Related Posts

Jeff Bezos’ ex-wife MacKenzie Scott Marries a Teacher
Lifestyle

Jeff Bezos’ ex-wife MacKenzie Scott Marries a Teacher

March 8, 2021
3
All You Need to Know about Trade Marketing in 2021.
Investment

All You Need to Know about Trade Marketing in 2021.

March 7, 2021
11
Who Is The 2nd Now When Elon Musk Falls To The 3nd-Richest Person In The World?
News

Who Is The 2nd Now When Elon Musk Falls To The 3nd-Richest Person In The World?

March 7, 2021
69
Five Things Advertisers Need To Know About The Newest Apple Privacy Changes
News

Five Things Advertisers Need To Know About The Newest Apple Privacy Changes

March 7, 2021
12
Something You May Not Know About The Battles Between Top Tech Giants
Entrepreneur

Something You May Not Know About The Battles Between Top Tech Giants

March 6, 2021
10
12 Easy Steps To Become A Good Financial Investment Advisor
Investment

12 Easy Steps To Become A Good Financial Investment Advisor

March 6, 2021
57

Popular Post

  • Great Businesses Ideas You Can Start for Less Than $100

    Great Businesses Ideas You Can Start for Less Than $100

    0 shares
    Share 0 Tweet 0
  • Top 10 Most Common Financial Mistakes That Keep You Poor Forever

    0 shares
    Share 0 Tweet 0
  • Fiery Red Stocks, Goldman Sachs And JPMorgan Urged Investors To Catch The Bottom

    0 shares
    Share 0 Tweet 0
  • 10 Signals That You Really Should Be An Entrepreneur!

    0 shares
    Share 0 Tweet 0
  • What Is The Real Meaning Behind Reddit’s GameStop Stock Battle?

    0 shares
    Share 0 Tweet 0

Categories

ADVERTISEMENT
ADVERTISEMENT
Investment.Ceo

We bring you the best Premium Articles that perfect for entrepreneurs, investors, finance students, etc. Check our page for details.

Learn more

Categories

March 2021
M T W T F S S
1234567
891011121314
15161718192021
22232425262728
293031  
« Feb    

Recent Posts

  • Jeff Bezos’ ex-wife MacKenzie Scott Marries a Teacher
  • Seven Ways to Persuade Yourself to Make Better Financial Decisions
  • All You Need to Know about Trade Marketing in 2021.

© 2020 Investment.Ceo - Investment Blog by Daily Investment.

No Result
View All Result
  • Daily Investment
  • Landing Page
  • Buy JNews
  • Support Forum
  • Contact Us

© 2020 Investment.Ceo - Investment Blog by Daily Investment.

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.