Robinhood has conspired with the big Wall Street hedge funds to confuse the everyday people who are suddenly rich with investments like GameStop … according to a new lawsuit.
The free trade app has just filed a lawsuit in federal court … one day after Robinhood barred retail investors from continuing to buy shares in several companies in the battle between Reddit bros and hedge fund executives.
Melvin Capital and Citadel, two massive hedge funds, are also being sued … because the case alleges that they shorted companies like GameStop and lost a lot of money as stock prices rose. The allegation is that the fund conspired with brokers such as Robinhood to block the purchase of certain shares to stop their financial bleeding.
In the lawsuit, filed by Larry Friedman and acquired by TMZ, a group of retail investors claims that Robinhood is moving to buyers closed led to prices falling in favor of the large hedge fund investors … while seriously hurting the finances of the little ones in the process.
The case claims that the problem is not limited to Robinhood and the hedge funds. Charles Schwab and TD Ameritrade are also being sued.
The little guys are going for at least $ 5 million in damages behind the fat cats of Wall Street.
Friedman tells TMZ: “Trading rules should be the same for everyone, no matter how big or small your investment is. There is no room for bullying or manipulation in the market. Fortunately, the courts are still the best place to find justice.”