Sonn Law Group is investigating findings by FINRA that many Robinhhood customers were given options approvals when they were not suitable for the customer, leading to large losses.
“A registered options principal must approve every options account”, said Jeffrey Sonn of Sonn Law Group. “Not all customers should be approved for options accounts and FINRA found that Robinhood mistakenly approved many customers to trade options where they should never been approved to trade options. We are investigating customers claims for damages after suffering losses in options when their options accounts never should’ve been approved”, added Sonn.
FINRA found that Robinhood wrongfully used “option account approval bots” to approve customers for options trading, with only limited oversight by firm principals. “Human registered options principles should have been doing those reviews in my opinion, Sonn concluded. “You cannot substitute a robot for the judgment of a registered options principal who must know their customer before they approve the opening of options account”. This, FINRA said, Robinhood failed to do.
“For those customers who lost money in options trading who should not of been approved for options trading they now have a viable claim against Robinhood. We will be representing those clients against Robin Hood”, said Sonn.