Parents of Man Who Died Thinking He Lost Over $730,000 Sues Trading App Robinhood After Student Killed Himself02/09/2021
The parents of a 20-year-old who died by suicide last year are suing the trading app Robinhood for what they say is their son's wrongful death.
Alex Kearns died by suicide in June 2020 after he was led to believe he owed more than $730,000 after making some risky trades, court documents, obtained by PEOPLE, say.
According to the lawsuit, Alex was sent an email demanding immediate action asking for a minimum deposit payment of more than $170,000, and when the college student attempted to reach customer service, he was unsuccessful.
"I was incorrectly assigned more money than I should have, my bought puts should have covered the puts I sold. Could someone please look into this?" the college student wrote in one of several emails to Robinhood seeking help. According to the suit, all he received was an automated email saying the support team would get back to him "as soon as possible, but that our response time to you may be delayed."
"He thought he blew up his life. He thought he screwed up beyond repair," Dan Kearns, Alex's dad, said in an interview with CBS News reported.
Tragically, the day after Alex took his own life, Robinhood finally returned his email — and it turned out that he didn't own any money at all.
"Great news!" the email — another automated message — said, according to CBS News. "We're reaching out to confirm that you've met your margin call and we've lifted your trade restrictions. If you have any questions about your margin call, please feel free to reach out. We're happy to help!"
"It haunts me. It really does," Dan said, adding that he believes Alex would still be alive if he had only received a prompt answer from the company.
"I lost the love of my life. I miss him more than anything," Alex's mother, Dorothy Kearns, told CBS News.
"I can't tell you how incredibly painful it is," she said. "It's the kind of pain that I don't think should be humanly possible for a parent to overcome."
Dan and Dorothy filed a wrongful death suit on Monday, seeking accountability from Robinhood.
"We don't want another family to go through this," Dorothy said.
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The complaint alleges that Robinhood uses "aggressive tactics and strategy to lure inexperienced and unsophisticated investors" — including Alex.
The complaint, obtained by PEOPLE, says that Alex was allowed to invest far above his experience level and was provided with "almost no investment guidance, and its customer 'service' was virtually non-existent, consisting of automated email replies devoid of any human contact or interaction."
"Tragically, Robinhood's communications were completely misleading, because, in reality, Alex did not owe any money," the complaint says. "He held options in his account that more than covered his obligation, and the massive negative balance would have been erased by the exercise and settlement of the puts he held."
While some changes have been made to Robinhood since Alex's death, including giving certain users the ability to request a call, there is still not a readily available customer service number for Robinhood users to reach out themselves, CBS News reported.
"How are those guardrails? How does that — how does that stop an 18-year-old from making risky trades that they don't really understand?" Dan said in his CBS News interview.
A representative for Robinhood did not immediately respond to PEOPLE's request for comment.
"We were devastated by Alex Kearns' death," a Robinhood spokesperson said in a statement to Business Insider.
"In early December, we also added live voice support for customers with an open options position or recent expiration, and plan to expand to other use cases," the statement said. "We also changed our protocol to escalate customers who email us for help with exercise and early assignment. We remain committed to making Robinhood a place to learn and invest responsibly."
A spokesperson told CBS News, "Our mission is to democratize finance for all. We designed Robinhood to be mobile-first and intuitive, with the goal of making investing feel more familiar and less daunting for an entire generation of people previously cut out of the financial system"
"Our focus has always been on breaking down systemic barriers to investing to help more people take control of their finances," they said.
If you or someone you know is considering suicide, please contact the National Suicide Prevention Lifeline at 1-800-273-TALK (8255), text "STRENGTH" to the Crisis Text Line at 741-741 or go to suicidepreventionlifeline.org.
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