[zenbane]

1) The NSCC (DTCC) confirmed that all parties met their depository requirements.

Even if they had not met the requirements (again, which they did), a depository requirement change is not an extenuating circumstance in the least. That is part and parcel of this business.

[tptacek]

Yes: Robinhood runs a casino dressed up as a brokerage, and packaged their offering as if settlement was instantaneous, rather than an efficient fiction built out of loans extended to everyone involved in settling a stock transaction. Brokerages put up substantial capital to insure themselves from each other based on how their customers are extending themselves; there are published formulas for how these capital calls work. Robinhood did their best to hide this reality from their customers, and got caught out.

Nobody should be defending Robinhood here. People are just wrong about what Robinhood did wrong.

[oakwhiz]

There are actually supporting claims for this theory from investors on Reddit who transferred "meme stocks" out of Robinhood and noticed wildly incorrect cost basis reports on fractional shares, with some screenshots showing values into the thousands of dollars per share. These posts could be found on subreddits such as Wall Street Bets, Superstonk, etc., for example: https://www.reddit.com/r/Superstonk/comments/ngs81d/just_got...

[gruez]

what is "this theory" and how do wrong cost basis statements support that theory? Is it that hard to make fake cost basis statements or something?

[oakwhiz]

"This theory" is the theory that "Robinhood runs a casino dressed up as a brokerage, and packaged their offering as if settlement was instantaneous, rather than an efficient fiction built out of loans extended to everyone involved in settling a stock transaction."

[gruez]

> 1) The NSCC (DTCC) confirmed that all parties met their depository requirements.

...the morning of. The deposit requirements will go up as customers place more trades.

>a depository requirement change is not an extenuating circumstance in the least. That is part and parcel of this business.

If it's a 99 percentile event that nobody could have saw coming happened, why shouldn't it be an extenuating circumstance? Keep in mind, they're a discount brokerage. It's like getting mad that your vps from a lowendbox provider had a few days of downtime because their raid6 had 2 disk failures.