Thousands of pissed off Robinhood investors are using a convenient app to join a class action lawsuit against the trading platform over temporary restrictions placed on GameStop and several other stocks, preventing people from buying securities in a move that artificially suppressed prices.
The service, DoNotPay.com, typically helps streamline the often-confusing process for consumers to get refunds and cancel subscriptions. As of Thursday, it can also help people join the Robinhood lawsuit, according to CEO Joshua Browder, who says he received hundreds of messages from enraged users, according to CNBC.
The lawsuit was filed Thursday in the Southern District of New York after Robinhood temporarily restricted GameStop trading on its platform. That enraged many small investors who were trying to get in on the GameStop trading frenzy of the past few days. -CNBC
"Robinhood is not acting in the consumer’s best interest," said Browder. "A lot of users who sign up aren’t the most sophisticated investors. They feel betrayed by a platform that has the literal name Robinhood."
By Friday afternoon, approximately 26,000 people had joined the class action, while 4,000 had filed complaints with the Securities and Exchange Commission (SEC). According to Browder, 400 more had entered arbitration via DoNotPay.
In order to participate, DoNotPay users need to detail their losses, and provide information on when their trades were halted. The law firm handling the class action is then notified of the potential participant's desire to join.
DoNotPay charges an annual fee of $36 for its services.
"Some people might disagree with that, but we don’t want to have the same business model as Robinhood," which, Browder said refers to commission-free trades.
"If you don’t pay for the product, you are the product."