June 2020, Alex Kearns, who was 20 years old at the time, from Naperville, Illinois, killed himself, largely thanks to a bug in the Robinhood system. The bug was that he turned on the app, it said he owed $730,000 that he did not have, because of options positions that he thought canceled out but didn’t appear to. He called the help line. The help line, of course, was not manned, as we’ve discussed. He sent several panicked emails — three, to be precise — did not receive a response. Ultimately there was a response from the emails saying that, in fact, his positions were covered. But by that point, it was too late, because he had taken his own life. The — this is a gentleman who is 20 years old. Under Illinois law, he was not allowed to buy a beer, but he was allowed to take on $730,000 in positions and exposure that he did not have the liquidity to cover. Your mission, Mr. Tenev, is to democratize finance. But the history of financial regulation is to protect people like Alex Kearns from the system. As the old joke goes, if you’re playing poker and you can’t figure out who the fish is at the table, you should leave the table because you’re probably the fish. And there is an innate tension in your business model between democratizing finance, which is a noble calling, and being a conduit to feed fish to sharks. So I’m nervous. I think I got an exposure. And I call your help line now. Let’s call and let’s listen in the time we have remaining to what I’m going to hear on the other end of the phone. Voicemail: “Thank you for calling Robinhood. Please visit us at robinhood.com or on our app for support. If you have an urgent trading need, please make sure to include details of it when reaching out. Thanks have a great day.”
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