The CEO of Robinhood during a congressional hearing on last month's Wall Street chaos apologized for restricting GameStop trading, calling what occurred "unacceptable."
Vlad Tenev, CEO of the trading app, offered his apology during a House Financial Services Committee hearing Thursday that examined the events surrounding Reddit users last month sending GameStop stock, which had been heavily shorted by hedge funds, soaring. On Jan. 28, Robinhood temporarily limited trading of stock from GameStop and other companies, citing "recent volatility," a decision that drew heavy criticism and scrutiny from lawmakers.
"Despite the unprecedented market conditions in January, at the end of the day, what happened is unacceptable to us," Tenev said. "To our customers, I'm sorry, and I apologize. Please know that we are doing everything we can to make sure this won't happen again."
He also insisted "Robinhood Securities played this by the books," and "played it basically the only way" they could.
Explaining further, Tenev said the "temporary restrictions" were put into place "in an effort to meet increased regulatory deposit requirements, not to help hedge funds." Elsewhere in the hearing, he told lawmakers the company needed to limit the trading "until additional capital came in that allowed us to relax the restrictions," adding that there were "limited options" during what he called a "one in 3.5 million occurrence event," but that Robinhood "owns what happened."
But The New York Times writes that it seemed Tenev's responses "failed to satisfy the members of the committee" during the hearing, with Rep. Carolyn Maloney (D-N.Y.) at one point saying "I don't blame customers for feeling treated unfairly." Brendan Morrow