Robinhood trading scandal: why it won’t happen to you – Fred Razak

Earlier this month, popular trading platform Robinhood reported that hackers had accessed almost 2,000 of its trading accounts. According to Bloomberg, an internal probe revealed that thousands of dollars had been mysteriously looted from Robinhood users in recent weeks. Victims of the ordeal said that not only was there no customer service phone number to field their complaints, but they also had to wait several weeks for any kind of feedback.

In our Friday Finance webinar, global financial markets specialist Fred Razak of CM Trading explained the risks involved in trading and how we can safeguard ourselves against disastrous situations like this.

“Most security firms have in place probably every sort of wall or safeguard that you could possibly do. Obviously, sometimes despite that, there are some breaches but generally speaking that’s not the norm. Out of the 20+ years that I’ve been involved in the markets, it’s not something that I’ve seen ever happen before. So this is definitely an anomaly – it’s not a normal occurrence,” he says. “I can’t even imagine it happening.”

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What to know when opening a trading account: 

  1. Security – The broker you invest with must be regulated by the Financial Services Board.
  2. Service – The company must provide excellent customer service. “You want to make sure that when you call the company that someone answers your questions,” says Razak.
  3. Price – Are you getting the best price for your execution?

To catch the full interview or to see one of our past Finance Friday webinars, visit our BizNews channel on YouTube.

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