Some Robinhood traders who are unable to contact customer service are trying another tactic: appearing at the front door.
Some Robinhood customers drove to the start-up’s California headquarters, demanding to speak to a representative and, in some cases, vandalizing the property, according to police reports.
A total of ten reports from January 28 to February 9 obtained by CNBC detail the frustration with the start of trading. Some customers tried to explain the account’s problems to security guards outside the indefinable one-story building in the Bay Area suburb and were given a paper form to fill out. There were no police reports related to Robinhood before that date this year, the department said.
A police spokesman for Menlo Park said the incidents included up to 15 people protesting outside the office and a male suspect throwing a T-shirt at a security guard. Another suspect sawed a sculpture on Robinhood’s property. A third man threw animal feces at the front door, police said.
Robinhood was criticized by users and legislators for restricting the buy-side of some negotiations in late January. Some accused Robinhood of protecting hedge funds that had sold shares like GameStop. Robinhood said he did not make these decisions based on the interest of market makers or hedge funds, and needed to limit trading to higher capital requirements.
Robinhood declined to comment on police reports and customer service complaints.
2,400 miles to Robinhood
Rayz Rayl, 43, said he had been using the free trade app for seven years and recommended Robinhood to friends before the end of January. The professional poker player told CNBC he lost $ 50,000 in trading with Nokia – one of several stocks that were limited on the platform due to volatility.
After unsuccessful attempts to contact Robinhood customer service, he decided to drive more than 2,400 miles from his home in Sellersburg, Indiana, last Thursday, to Robinhood’s headquarters to close his account.
“I have money in my Robinhood account that I need to support” Rayl, who has three children, said in an interview outside Robinhood’s headquarters. “My money is currently held hostage by Robinhood, I can’t take it away.”
Rayl said he was locked up for more than 10 days. After his interview, and a request for comment from Robinhood by CNBC, he was contacted by customer service and managed to access his account.
CNBC witnessed another Robinhood customer kicking and knocking on Robinhood’s front door, claiming that the start-up had “$ 2 million of my money on hold” and asking to “get my account number”. The man refused to speak about his complaint.
In the following weeks, more than two dozen lawsuits were filed against Robinhood by clients seeking compensation. Another lawsuit filed against the trading app this week is from the family of Alex Kearns – a 20-year-old who committed suicide last year after mistakenly thinking he owed more than $ 730,000 after trading options.
To be sure, the Menlo Park incidents represent only a handful of Robinhood’s 13 million customers. Despite the online and Capitol reaction, the start-up appeared to add registration accounts in the last week of January. JMP Securities estimates that Robinhood saw 600,000 mobile downloads during GameStop’s trading week.
Robinhood’s user policies outline the potential for losses and restrictions on trading. Users agree that “Robinhood may, at its discretion, prohibit or restrict the trading of securities, or the replacement of securities, in any of My Accounts.”
Rayl said he knew the risk of losing money when he signed up for Robinhood, and lost up to $ 20,000 in a single day in poker. For Rayl, his inability to buy certain shares made it stand out from other losses. He said that Robinhood limiting customers’ negotiations meant “pulling the carpet from under” customers.
For now, Rayz is on a stock market hiatus.
“I don’t trust Wall Street right now – I’m transferring all the money to the cashier and taking a break,” said Rayz. “I don’t know if I will ever negotiate again after that happens.”