Robinhood pays $30M in fines, restitution for faulty AML program, customer disclosures

Robinhood will pay nearly $30 million in penalties for violating Financial Industry Regulatory Authority (FINRA) rules with shortcomings in its anti-money laundering (AML) program, as well as supervisory and disclosure violations.

Two subsidiaries of Robinhood Markets–Robinhood Financial and Robinhood Securities–had AML programs that failed to “detect, investigate, or report suspicious activity, including manipulative trading, suspicious money movements, and instances where customers’ accounts were taken over by third-party hackers,” FINRA, a self-regulatory organization that oversees broker-dealers, said in a press release Friday.

Robinhood Financial also failed to establish a reasonable customer identification program, FINRA said, which “resulted in the firm opening thousands of accounts when it had not reasonably verified the customer’s identity.”