The probes and lawsuits are coming.
Texas Attorney General Ken Paxton sent out a Civil Investigative Demand to 13 entities, including Robinhood and Citadel, regarding the “suspension of stock trading and investing” requiring higher margin reserves for trading certain companies and suspending chat platform activity.
Other names which were also issued CIDs include Discord, Robinhood Markets, Robinhood Securities, Interactive Brokers, TD Ameritrade, TD Bank, E-Trade, WeBull Financial, Public Holdings, M1 Holdings, Citadel Financial, and Apex Clearing.
“Wall Street corporations cannot limit public access to the free market, nor should they censor discussion surrounding it, particularly for their own benefit. This apparent coordination between hedge funds, trading platforms, and web servers to shut down threats to their market dominance is shockingly unprecedented and wrong. It stinks of corruption,” said Attorney General Paxton.
“I’m hopeful that these companies will step up and cooperate with these CIDs in order to clear any confusion over why stock purchases were forcibly closed and why even conversation around these stocks was silenced.”
In addition to public statements and internal documents, the CIDs request copies of all terms of service, policies related to content control and moderation, and communications between platforms and moderators of chat servers, including decisions to limit, control, or prevent access to the Discord r/WallStreetBets server.
Read more: Texas Attorney General Issues Investigative Demands To Robinhood, Citadel, And Others Over ‘Shocking Coordination’ Between Hedge Funds And Trading Platforms To Halt Trading Hitting Hedge Funds