Parents Sue Robinhood Stock Trading App After Son Commits Suicide Believing He Owed $730K- When he Didn’t!
The parents of a 20-year-old man who committed suicide after mistakenly believing he owed $730,000 to Robinhood plan to file a wrongful death lawsuit against the stock-trading app, according to a report.
University of Nebraska student Alexander Kearns, who had begun dabbling in trading, ran into problems on June 11 when the app put a hold on his account showing that he was $730,000 in the red and that he needed to pay over $170,000 in the coming days.
“He thought he blew up his life,” Alex’s dad, Dan Kearns, said in an interview with the network. “He thought he screwed up beyond repair.” It is understood that Kearns had been trading options, rather than stocks, so the negative balance he thought he owed was probably a temporary amount that showed until the options settled to his account.
According to reports, there was no customer service number for Kearns to call and while he did email Robinhood three times, he only received an automatic response that app reps would get back to him when they could, noting a possible delay in replies.
Sadly, the next day, June 12, Kearns killed himself by stepping in front of an oncoming train. He left behind a suicide note that said, “How was a 20-year-old with no income able to get assigned almost a million dollars worth of leverage?”
Kearns’ mom, Dorothy Kearns, said: “I lost the love of my life. I can’t tell you how incredibly painful it is. It’s the kind of pain that I don’t think should be humanly possible for a parent to overcome.”
Ironically, and in a horrible twist of fate, the app sent a message to the amateur trader the day after his suicide, saying, “Great news! We’re reaching out to confirm that you’ve met your margin call and we’ve lifted your trade restrictions.”
In the lawsuit, expected to be filed today, Monday, the parents said Robinhood “must be held accountable. The information they gave him was just incredibly skewed and possibly completely wrong.”
Robinhood said they have made changes since Kearns’ devastating death, including adding instructions and educational materials for options trading and adding screening for experience for riskier trades.
They also now have a call-back option from a live agent and a mechanism in place to escalate emails like the one that Kearns sent, the outlet reported.
“We remain committed to making Robinhood a place to learn and invest responsibly. Our mission is to democratize finance for all,” a spokesperson for the app said.
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