In June 2021, Alex Kearns committed suicide after he was told by the app Robinhood that he had lost $730,000 and the company would come to collect $170,000 in days. In a note left behind the 20-year old blamed the app for letting him take so much risk.
On Monday, his family said that they have sued Robinhood for wrongful death. Although Kearns did not owe the app money, he received an “immediate action required” email which told him to deposit $178,612.73 by June 17, last year.
Kearns reportedly tried to contact the app’s support department but received automated messages. Unfortunately they day after he died, he received an automated message that told him that he didn’t owe money according to an earlier CBS News report.
Robinhood said that it would change its app’s working and donated $250,000 to the American Foundation for Suicide Prevention.
The app is also facing several lawsuits for its role in the GameStop/Reddit event which also led to huge trading losses. A forum called Wall Street Bets on Reddit recommended short stocks including GameStop through the Robinhood App.
There was a trading frenzy and GameStop and a few other companies reach huge heights and then fell to abysmal lows. There are investigations into these events to find out whether individual traders joined together to manipulate stocks. Other traders have said that they had to face big losses as the app froze some options including how much to invest and the time they could invest.
The traders also complained that Robinhood’s software sold a few options without asking them but the app claimed that it did not sell shares automatically.
Both these lawsuits are of relevance currently as traders have lost real money in the recent events and a young man died by suicide less than a year ago because he believed or was made to believe that he had lost a huge sum of money.
It would be good if you know someone who lost money contact the National Suicide Prevention Line before taking any drastic action that may affect their or their families’ lives.
