OKLAHOMA CITY — Reps. Logan Phillips, R-Mounds, and Trey Caldwell, R-Lawton, are calling on Oklahoma Attorney General Mike Hunter to open an immediate investigation into the recent actions of the stock trading and investing app, Robinhood.
On Thursday (Jan. 28), in response to a large online group of retail investors targeting specific securities, Robinhood restricted trading of the stocks for a full trading day.
“The trading restrictions implemented by Robinhood are a clear example of market manipulation designed to protect big banks and hedge funds,” Phillips said. “The app claims to want to ‘democratize finance,’ but their actions over the past 48 hours have served to silence individual investors, including thousands of Oklahomans. I am calling on Attorney General Hunter to open an immediate investigation into the actions taken by Robinhood.”
The stocks restricted from purchase on Thursday included AMC; Bed, Bath and Beyond; Gamestop; Nokia; BlackBerry; Express; Koss and Naked Brand Group. The purchase of these stocks, which had been shorted by Wall Street investment firms, was encouraged on the popular Reddit page “r/wallstreetbets.”
Due to the increase in purchase of these stocks among retail investors, the investment firms lost billions on their return, and Robinhood blocked the purchase of the stocks. Limited purchase power was restored as of Friday morning, and Robinhood cited “market volatility” as their reasoning for the restriction
“Robinhood can try to hide behind the excuse of ‘market volatility’ as their reasoning for restricting stock purchase, but in reality they were trying to keep the average citizen from winning in a system that favors Wall Street over Main Street,” Caldwell said. “They must be investigated and held accountable for their actions, which fly in the face of SEC rules designed to protect investors.”
There has been bipartisan demand for an investigation into this matter at the federal level, and the U.S. Securities and Exchange Commission (SEC) released a statement saying they will be “closely reviewing” Robinhood’s actions.
Joining Phillips and Caldwell in calling for the Attorney General to take action are Rep. Garry Mize, R-Guthrie and Rep. Sherrie Conley, R-Newcastle.