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Robinhood-Free Stock Trading Scam Trading Company Palo Alto California
Don't allow Robinhood to entice you with their $0 fee schedule. Robinhood is a fairly new trading company that was started in 2014. The only way to open an account with them is online via a mobile device (tablet, iphone, etc). They sucker people into opening an account by offering $0 trade fees, but they are very quick to charge customers a $30 fee when your bank does not automatically allow them to withdraw money.
I had an account with them for less than 2 weeks before I noticed something was wrong. I deposited a small amount the same day that I opened my account and selected the business that I wanted to buy stock from. Days passed before I received an email from Robinhood that my account had suddenly been deactivated due to a 'stop payment'. (There was no actualy stop-payment made from my end; the problem was Robinhood wasn't able to withdraw money from my account at their convenience). I contacted Robinhood to let them know that I had not initiated a stop payment and they gave me the run-a-round. I looked at my bank account and noticed that no money had even been withdrawn from my account. They promised to credit me with $30 as long as I made a $30 deposit (red flag #1)
I contacted my bank to let them know that something was wrong and that I had not initiated a stop payment. I found out that Robinhood had tried to withdraw money from my account without permission. They deactivated my account then when I tried to have it re-activated, they once again, gave me the run-around. They asked that I provide them with a current bank statement and a photo id. After I sent this to them via email, they YET AGAIN, gave me the run-a-around!! This time they asked that I print and sign a form stating that I was the owner of the account because the bank account and my id had 2 different names on the account, which is not true in the slightest!! The even asked that I have the form NOTARIZED!! (Why in the world would I go through all of this just to open a trading account?) My name is the only name on my bank account. It's not shared with anyone else.
Anyway, I tried calling customer support to no avail then I emailed them. I let them know that I was no longer interested in doing business with them and to disregard the information that I had sent them. I hate knowing that my personal info (photo i.d. and bank statement) is floating around out there in their hands. It all seemed too suspicious for me to continue banking with them.
Finally, I decided to open an account with a competitor, Loyal 3. I've read numerous complaints already online concerning their practices and one complaints mirrors my own! I urge anyone reading this to save yoruself time and suspicionss and steer clear of Robinhood. They won't be around too much longer.
5 Updates & Rebuttals
Business
Atlanta,Georgia,
United States
Robinhood is still a scam
#6Author of original report
Mon, June 08, 2020
Obviously the person above defending Robinhood is an employee who is upset that their scams have been exposed.
Thomasthe4th
miami,Florida,
United States
I don't see the SCAM in any of this especially in restating the word SCAM and then goodbye as if it proves any point
#6Consumer Comment
Sun, June 07, 2020
I use Robinhood and have made quite a lot of money. I also have not had the funds I was advanced by Robinhood multiple times through no fault of the company. They do not charge $30. That is a lie. They charge $9. If you are charged 30 its because you did 3 transfers and all were returned. They are very fair considering they pay for the investments your making up front so you can catch the move in the market immediately and not days later when your money clears.
They advance you up to $5,000 without a credit check and allow you all the time you need to pay it back if your transfer does not go through for a measly $9 for a reversal that is your fault for not having the money in the account per your agreement. Name any best friend or family member that will loan you 5k on the spot? Stock investment companies do not need to scam small time investors for $30 when they handle millions of dollars each day. They make their money in ways that do not involve your investment money or returns. Like ads and affiliates and other ways.
They warn you your transfer has started and inform you when it is being processed and that gives you plenty of time to be ready. If your not whose fault is that? Robinhoods? Its a shame when an angry person lies or gives an unfair and biased account of a company and can affect their business or more importantly ruins new investors chances to imporve their life and learn to invest by steering them away from a good thing out of spite especially when its so clearly not an accurate or fair account of what transpired. There is always two sides to a story and there are millions of normal or average income people that have been able to free themselves from a 9 to 5 or take better care of their family thanks to Robinhood. I am proof of 1. -Thanks
Jennifer
Winchendon,Massachusetts,
United States
Robinhood NOT a scam
#6Consumer Comment
Wed, March 20, 2019
I wanted to file a rebuttal to the comment that Robinhood trading site is a scam. I agree with the second person who commented that it is NOT a scam. I have been using therobinhood trading site for 2 months, and I was leery at first as it seemed too good to be true (free trading??!!) But it is exactly what it says. I do not get charged for any transaction fees for buy or sells.
It is definitely not as robust of a system as some others but where others pay 4.95 and up PER transaction, I really don't care. You can still do limit buy and sells and once you have been trading for a while you can do option trading too. You are provided the opportunity to upgrade to gold and then you can spend more money to trade but I am happy with my trading as I am not a big trader but do it more as a hobby.
The site is great and getting a charge for a bank refusing a debit from robinhood is obviously normal. Anytime a charge is refused by a bank to a vendor, that vendor will charge you back. I haven't had that issue anyways. And I haven't had to wait 3 days for the funds in order to start trading (other sites do require a settling period) but Robinhood allows you to start trading even though the funds are still in your bank expecting that the debit will successfully go through.
You need to ensure the funds are there when the debit does go through obviously.
Just a consumer using the Robinhood platform and I couldn't be happier.
BusinessWoman
Atlanta,United States
Scam
#6Author of original report
Wed, January 30, 2019
As I stated, Robinhood is a scam. End of story. Goodbye.
Gerald
Florida,United States
Robinhood, Scam, Not So Much
#6Consumer Comment
Wed, January 30, 2019
Firstly, I've used Robinhood for almost three years after hearing about it from a college classmate. I wanted to offer a different perspective from the one above. Robinhood is hardly a scam in my opinion, it is simply the froth of a new wave in Investing for regular folk. Robinhood offers $0 commissions, this may seem something to be skeptical of but it isn't. Robinhood is capable of this because they divested themselves of brick and mortar stores and are 100% online, they also gain interest on the balances in your account in the same way a bank does, as well as their premium service Robinhood Gold.There is a 3 day wait period for transferring funds which I consider to be one of the trade offs.
Secondly, yes there is a $30 fee for reversed payments, one which I personally incurred after transferring from the wrong account, though it can be avoided by ensuring you have the amount to be transferred available in the From account during the three day period as well as ensuring all information is correct. The fee is steep but is offset by commissions saved on each transaction and only occurs when there is a reversal of transfer most likely caused by insufficient funds. Also, it is important to note that E-Trade, a leading traditional Broker charges $25 for reversed transfers, while their stock/option fee is $6.95. I regret that I cannot say whether the customer serivce is lacking as I have not had a reason to call on them in the three years i've used the service, I suppose one could consider that a good thing. All in all I consider Robinhood a very viable alternative to traditional stock brokers for those getting into Investing and a great company that has consistently improved and added to their service since it's inception.