In the House, Representative Maxine Waters, who chairs the House Financial Services Committee, said she also intended to hold a hearing. “As a first step to curb these abusive practices, I will convene a hearing to examine recent activity around GameStop (GME) stocks and other impacted stocks, with a focus on short selling, trading platforms online, gamification and their systemic impact on our financial markets and retail investors, ”she said in A declaration.
News of the hearings comes after Robinhood was struck down by a class action after restricting users – more than half of whom own stock GameStop – of the Thursday negotiation. The company said in an update would resume “Limited purchases of these titles” from Friday.
Separately, Fox Company reported that Robinhood was planning an SEC investigation which “involves market manipulation”. “The SEC is kind of going to look at the Reddit charts and try to figure out who’s promoting what, who’s bragging what, and maybe sort of tie that in with the trades,” Fox Company ‘ Charlie Gasparino said, citing “regulatory sources”. He added that such an investigation is probably an “impossible” task since most Reddit users are anonymous.
A Robinhood spokesperson did not immediately respond to a request for comment on potential investigations. And while the SEC hasn’t officially weighed in on Robinhood, Reddit, or GameStop, it did publish A declaration earlier this week he said he “actively monitors continued market volatility in the options and equity markets.”