Robinhood to offer “case-by-case” compensation following mass outage on Monday

By Aisling Finn on Wednesday 4 March 2020

Savings and Investment

Despite earlier reports, the outage was apparently not caused by a date-related oversight.

Robinhood to offer “case-by-case” compensation following mass outage on Monday
Image source: Co-founders and co-CEOs of Robinhood Baiju Bhatt and Vladimir Tenev.

Robinhood, the free US stockbroking app, saw an outage on Monday reportedly leaving its investor customers stuck in their trading positions.

As the US stock market surged some $1.1 trillion after a sustained downturn caused by Coronavirus uncertainty, anti-Robinhood Twitter accounts posted screenshots indicating some customers had either missed out on or made losses totalling thousands of dollars.

Robinhood tweeted: “Our system is experiencing downtime issues that are affecting all functionalities on our platform.”

“We are aware of the issue and are working to have all systems up and running as soon as we can.”

Following public outrage and in response to earlier reports that Robinhood’s downtime had been due to a leap year date glitch, co-founders Baiju Bhatt and Vladimir Tenev posted a statement explaining the outage was due to: “stress on our infrastructure—which struggled with unprecedented load.” 

“That, in turn, led to a ‘thundering herd’ effect—triggering a failure of our DNS system.”

A spokesperson for Robinhood told TechCrunch yesterday that the company was now looking into compensation “on a case-by-case basis”.

Following the outpouring of anger and a Twitter account being set up threatening a class-action lawsuit, Robinhood initially said they would start the compensation process by offering its Robinhood Gold customers three months free, the equivalent to $15.

Little relief for those investors who find themselves severely out-of-pocket.

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