“I’m in tremendous mental stress right now because this is all of my savings,” said Rao, 36, whose account was frozen by Robinhood in response to the fraudulent activity. He said Robinhood contacted him on Friday and unlocked the account after sending several emails late Thursday asking for help.
Rao showed Bloomberg the same emailed response from Robinhood that Bagheri received. “We understand the sensitivity of your situation and will be escalating the matter to our fraud investigations team,” Robinhood customer service agents wrote them. “Please be aware that this process may take a few weeks, and the team working on your case won’t be able to provide constant updates.”
Rao said he had previously set up two-factor authentication to access his account, and Bagheri said she’s certain her Robinhood password is unique from all others, including her email. Neither believed they had been duped by phishing scams or malware. Both said they use the same email for Robinhood and other accounts, and that only Robinhood has been affected.
“Unfortunately, it’s a common occurrence that online accounts of monetary value are bought, sold and traded by cyber-criminals,” said Mark Arena, CEO of Intel 471, which monitors activities of digital criminals. “This shows the importance of people practicing common information-security hygiene such as not re-using the same password across multiple accounts and enabling two-factor authentication, which Robinhood supports.”
Stock, Bitcoin
They also said Robinhood’s online portal showed their money went to a recipient at Revolut, another popular financial-technology startup. London-based Revolut, which offers a money transfer and exchange app, expanded to the U.S. this year.
“Revolut has been made aware of the issue and is investigating urgently,” a company spokesman said Friday in an email.
Bill Hurley, who owns a metal-fabrication shop in Windsor, Connecticut, said he received notifications that stock and Bitcoin had been sold from his account on Sept. 21, and that $5,000 was transferred to Revolut accounts in two transactions. He said he emailed Robinhood for assistance while the transactions were pending but received none.
“They’ve had more than enough time to deal with this,” he said.
Hurley, 56, said he reached out to the SEC and heard back from a lawyer for the regulator, who asked for additional information on what had happened.
After more than two weeks of emails seeking help from Robinhood, a customer support representative called him on Thursday, he said.
--With assistance from Ben Bain and William Turton.
This article was provided by Bloomberg News.