Robinhood (NASDAQ:HOOD) has been fined $30 million by the New York State Department of Financial Services (NYDFS). The penalty is for allegedly violating cybersecurity and anti-money laundering standards.
Robinhood’s Bank Secrecy Act and anti-money laundering compliance systems, according to the regulator, were “understaffed.”
As its business evolved, Robinhood Crypto allegedly failed to commit the resources required to build a compliance culture, resulting in major violations of the department’s anti-money laundering requirements. Finance and cybersecurity
According to NYDFS, the company’s cybersecurity program had severe flaws and failed to effectively address “operational risks.”
Furthermore, because there was no dedicated telephone number on its website for customer complaints and it did not comply with reporting requirements, Robinhood would not have met with consumer protection standards.
Over the last two years, the business has paid $100 million in fines to authorities. For failing to protect customers, the Financial Industry Regulatory Authority (FINRA) penalized it $70 million in 2021.