Hackers Hit 2,000 Robinhood Accounts: Reports

October 16, 2020

Far more customers of zero-commission brokerage Robinhood had their accounts compromised in a recent cyberattack than previously thought, according to news reports.

Last week, several Robinhood customers told Bloomberg that they saw money vanish from their accounts and were unable to get help because the company doesn’t have a customer support phone number. A Robinhood spokesperson told reporters that the accounts may have been hacked as a result of compromised email addresses, but that the breach didn’t happen on Robinhood’s systems.

The brokerage had also described the number of accounts hackers hit a "limited."  

But a recent internal probe by Robinhood found that almost 2,000 accounts got hacked, a person familiar with the matter who asked to remain anonymous tells Bloomberg. 

The brokerage is now weighing adding customer support number and other tools, the person says, according to the news service.

“We always respond to customers reporting fraudulent or suspicious activity and work as quickly as possible to complete investigations,” the company tells Bloomberg in an emailed statement. “The security of Robinhood customer accounts is a top priority and something we take very seriously.”

Robinhood sent customers push notifications this week to set up two-factor authentication and plans to put out more guidance on security, the news service writes, citing the statement.

But some customers say their accounts were hacked despite having two-factor authentication already, while several customers claim there’s no sign their accounts were compromised by hackers, according to Bloomberg. 

One customer tells the news service she had to wait for weeks to get a response from Robinhood about alerts on investments being sold and then getting locked out of her account. 

And another customer, Miah Brittany Laino, appears to have discovered how her Robinhood account was hacked, Bloomberg writes. After not getting a response from customer support about stocks being sold in her account after she deactivated her account, Laino discovered that someone hacked her email’s trash bin to intercept messages from the brokerage, according to the news service. She then learned that someone forged her identification to reactivate trading, Bloomberg writes.

Technological issues with Robinhood accounts have landed the brokerage in the headlines several times this year. The firm’s platforms suffered outages in March, preventing customers from accessing accounts during some of the biggest market moves. The SEC and Finra are investigating how Robinhood handled the outages while several customers have filed lawsuits.

This summer, a young Robinhood customer took his own life, reportedly after seeing what was likely a temporary negative balance of $730,000.

Do you have a news tip you’d like to share with FA-IQ? Email us at editorial@financialadvisoriq.com.  

By Alex Padalka
  • To read the Bloomberg article cited in this story, click here if you have a paid subscription.