The parents of a 20-year-old man who committed suicide after mistakenly believing that he owed $ 730,000 Robinhood intends to file an unjust death claim against the stock trading application, according to a report.
University of Nebraska student Alexander Kearns, who had started trading, ran into trouble on June 11, when the app got his hands on his account, showing that he had $ 730,000 in red and had to pay over $ 170,000. dollars in the coming days, CBS News reported.
“He thought he blew his life,” Alex’s father, Dan Kearns, said in an interview with the network. “He thought he cheated without repair.”
Kearns had traded options rather than shares, so the negative balance was probably a temporary amount that showed up until the options settled into his account.
There was no customer service number for Kearns to call, and while he emailed Robinhood three times, he only received an automatic response for the app to return to him when he could, noticing a possible delay in responses, the report shows.
The next day, June 12, Kearns committed suicide by stepping in front of an approaching train.
He left behind a suicide note that said, “How could a low-income 20-year-old get a leverage of nearly $ 1 million?”
Kearns’ mother, Dorothy Kearns, told the media that she “lost the love of my life.”
“I can’t tell you how incredibly painful it is. It’s the kind of pain I don’t think it should be human for a parent to get over, “said the troubled mother.
Ironically, the app returned to the amateur trader the day after the suicide, saying, “Wonderful news! We will contact you to confirm that you have completed the margin call and that we have lifted the trade restrictions. ”According to the report.
Dan said the app should have stronger checks to verify the experience of traders.
“How are these railings?” How do you do that – how do you stop an 18-year-old from doing risky transactions that you don’t really understand? “Dan told CBS he was referring to a screening question that allows someone to trade even if he says he doesn’t have much experience.
In the process that is expected to be filed on Monday, the parents said that Robinhood “must be held accountable”, according to the news site.
“The information they gave him was incredibly distorted and possibly completely wrong,” said Benjamin Blakeman, Kearns’ lawyer.
“Because they make it look like you owe $ 730,000, when you really don’t owe anything,” Blakeman told reporters. “That could panic for anyone.”
Another family lawyer, Ethan Brown, told CBS that he “does not provide any mechanism through a live phone call, through the live e-mail service, to get live answers to questions.”
Kearns said their son just wants answers and help, the report said.
Robinhood told CBS of the changes they have made since Kearns’ devastating death, including the addition of instructions and educational materials for options trading and the addition of screening for the riskier transaction experience.
They now also have an option to call back from a live agent and a mechanism to escalate emails, such as the one sent by Kearns, the press reported.
“We remain committed to making Robinhood a place of responsible learning and investment. Our mission is to democratize finance for all, “an application spokesman told CBS.
“We designed Robinhood to be the first mobile and intuitive, in order to make investments feel more familiar and less discouraging for a whole generation of people previously excluded from the financial system,” the statement continued.
Robinhood recently came under fire when it stopped people from buying GameStop shares and other shares that exploded in a market frenzy last month.