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Robinhood conspired with the big Wall Street hedge funds to screw the everyday people who suddenly hit it rich with investments like GameStop … according to a new lawsuit.
The free trade app has just been hit by a class action lawsuit in federal court … a day after Robinhood banned retail investors from continuing to buy shares in multiple companies in the battle between Reddit bros and hedge fund managers.
Melvin Capital and Citadel, 2 huge hedge funds, are also being sued … as the lawsuit claims they were selling companies like GameStop and losing a lot of money as stock prices rose. The allegation is that the fund conspired with brokerage houses like Robinhood to block the purchase of certain stocks in order to stop their financial bleeding.
In the lawsuit, filed by Larry Friedman and obtained by TMZ, a group of private investors claim the transition from Robinhood to close buyers drove prices down in favor of large hedge fund investors … while seriously damaging the finances of small ones in the process.
The lawsuit says the problem is not limited to Robinhood and hedge funds – Charles Schwab and TD Ameritrade are also being sued.
The little guys are going after the big cats on Wall Street for at least $ 5 million in damages.
Friedman told TMZ: “The trading rules should be the same for everyone, regardless of the size of your investment. There is no room for intimidation or manipulation in the market. the courts are always the best place to find justice. “
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