Robinhood sued by family of 20-year-old trader who killed himself after believing he racked up huge losses

 

• Robinhood was sued Monday for wrongful death by the family of Alex Kearns, a 20-year-old customer who took his life last summer.
• Kearns committed suicide in June after thinking he had a negative $730,165 cash balance on Robinhood.
• Robinhood’s “reckless conduct directly and proximately caused the death of one of its victims,” the complaint said.
• The suit says that Kearns made three attempts to contact Robinhood customer service regarding the massive underwater balance. However, his messages were met with automated replies, according to the complaint.

• Robinhood was sued Monday for wrongful death by the family of Alex Kearns, a 20-year-old customer who took his life last summer after believing he had racked up big losses on the millennial-favored stock trading app.

  “This case centers on Robinhood’s aggressive tactics and strategy to lure inexperienced and unsophisticated investors, including Alex, to take big risks with the lure of tantalizing profits,” said the complaint filed by his parents Dan and Dorothy Kearns, and his sister Sydney Kearns in a California state court in Santa Clara. The family is based in Naperville, Illinois.

• The Securities and Exchange Commission charged the brokerage in December with misleading customers about how the stock-trading app makes money and failing to deliver the promised best execution of trades.

  The Kearns’ family complaint says, “Not only did Robinhood permit Alex to open the account, but when Alex was a freshman in college later that year, it permitted him to trade options.”

  “Worse, Robinhood provided almost no investment guidance, and its customer ‘service’ was virtually non-existent, consisting of automated e-mail replies devoid of any human contact or interaction,” the family alleged in the suit.