The stock trading app Robinhood, in order to attract more users, bills itself as an easy opportunity to make money without specialized knowledge, but the younger target demographic may not realize the actual risks of options trading.
A 20-year-old University of Nebraska student, Alexander Kearns, killed himself last summer after mistakenly thinking he owed $730,000 to Robinhood. His parents have filed a wrongful death suit against the stock-trading platform, CBS reported on Monday.
Kearns created his account in Robinhood when he was at school. The app has been positioning itself as an open investing platform that “democratizes finance,” allowing inexperienced people to buy and sell shares any fees although such risky operations are fraught with significant financial losses.
In an interview to the broadcaster, Dan and Dorothy Kearns accused Robinhood of letting amateur investors gamble without any experience. Kearns’ parents are upset that the company did not answer their son’s emails or explain the mistake, before their son decided to end his life.