FinTech News
Hack Affects “Almost 2,000” Robinhood Accounts
It seems that the uber-popular trading app Robinhood has run into more issues. According to a report from Bloomberg, a hack left nearly 2,000 Robinhood accounts compromised. In some cases, those accessing the accounts sold off assets being held and transferred the funds. While Robinhood didn’t offer many details on their findings, they state that “a limited number” of customers were impacted. Currently, the trading app has more than 13 million users. In response to the rash of compromised accounts, Robinhood sent out notifications to users encouraging them to opt-in to two-factor authentication. This would require users to confirm their identity by entering a PIN sent to their phone via text message or by using a code generator such as Authy.
For their part, Robinhood says the breaches were the result of hackers gaining access to personal email accounts outside of the app. According to Bloomberg, however, some of those affected say they already had two-factor authentication engaged. Additionally, the outlet spoke with users who say that they’ve seen no evidence that their email had been accessed as Robinhood states — although others acknowledge that their email accounts had been hacked.
Some of the users impacted also complained to Bloomberg that it was difficult for them to get support from Robinhood in order to restore and secure their accounts. In response, a spokesperson for the app said, “We always respond to customers reporting fraudulent or suspicious activity and work as quickly as possible to complete investigations. The security of Robinhood customer accounts is a top priority and something we take very seriously.”
Unfortunately for the app, the breach wasn’t the only controversy it found itself in recently. Last Thursday, Robinhood informed some users that they would need to increase their cash buffers or face margin calls on some of their stocks. Asked about the move, a Robinhood spokesperson told Business Insider, “Rather than doing a blanket change that impacts all customers, Robinhood Securities conducted a portfolio analysis and is raising margin requirements for certain securities.” The company also says the change in margin maintenance was intended to help protect users from pre-election market volatility.
It seems as though Robinhood’s growing prominence has put a target on its back — ironic given its bow and arrow-wielding namesake. While the company has made some legitimate missteps, it’s difficult to say whether either of these recent incidents can really be blamed on the app. Regardless, these stories and incidents can taint the company’s reputation as well as the public’s view of FinTech as a whole. What’s important is that the industry learns from these events. It may take time but, in the end, they’ll be stronger for the experience.
