Robinhood has faced a slew of bad publicity recently over the way the company reacted to the Reddit fueled stock craze. Today the commission-free trading app is facing an unrelated lawsuit that is also shining a negative light on the company. CBS News writes: “20-year-old Alex Kearns took his own life last June mistakenly believing he’d lost nearly $750,000 in a risky bet on Robinhood, the stock-trading app where he started trading as a teenager.”
His parents are filing a lawsuit today “accusing Robinhood of wrongful death, negligent infliction of emotional distress and unfair business practices.”
The Kearns believe Alex’s inexperience is what got him into trouble after a transaction last year. On June 11, he saw Robinhood restricted his account reflecting what appeared to be a negative balance of $730,000.
The Kearns say Alex tried to contact customer service, but the company had no phone number. An email he sent received an automated response. On the day he got that note, he killed himself leaving behind a letter that said, “A painful lesson. F*** Robinhood.”
An absolutely shattering story right down to the detail that he may not have actually lost any money at all. https://t.co/brRJG5Hrxn
— Tony Dokoupil (@tonydokoupil) February 8, 2021
CBS received a statement from Robinhood saying they were “devastated by Alex’s death and outlined changes they’d made since June, which include guidance to help customers engaged in options trades similar to Alex’s.”
Watch the story above.