Did The President Of Robinhood Dump All His AMC Stock Right Before They Restricted Trading?

It may seem like ancient history now, but back in January the great WallStreetBets short squeeze was all the rage, having sent heavily shorted meme stocks like GME and AMC to unprecedented heights as millions of retail daytraders used their Robinhood account to pile on and buy in wave after seemingly endless wave in the process crushing reputable hedge funds such as Melvin Capital which needed multi-billion capital infusions to avoid being margin called to death. That wave, however, came to an abrupt end on January 28 when Robinhood took the unprecedented action to “render the financial system inaccessible” to millions of customers and investors, as a recently filed class-action lawsuit claims, when it went into sell-only made as the retail brokerage found itself short on regulatory capital as a result of the unprecedented buying tsunami, and imposed temporary bans on purchases of 13 heavily shorted stocks in the process ending the epic momentum wave and allowing a fresh round of short sellers – which the lawsuit claims included such financial scions such as Citadel – to generate material profits.

The fact that Citadel also happens to be Robinhood’s biggest customer and pays the retail brokerage hundreds of millions to frontrun retail orders placed on the Robinhood brokerage in the form of Payment for Orderflow, only added to the complexity and reflexivity of the situation.

We discussed this episode in great detail back in February in “Exposing The Robinhood Scam: Here’s How Much Citadel Paid To Robinhood To Buy Your Orders“ in which we said “Frankly, we’ve had it with the constant stream of lies from Robinhood and neverending bullshit from the company’s CEO, Vlad Tenev.” And while we laid out all the lies we had observed from both Robinhood’s CEO and Citadel, including Citadel’s threats to sue us into oblivion for alleging they frontrun their own customers only for FINRA to accuse Citadel of doing just that (resulting blessed silence from Citadel’s lawyers as far as we are concerned), the best summary of the entire January farce belonged to Michael Burry who on February said in a since deleted tweet that “The #mainstreetrevolution is a myth. Zero commissions and gamified apps were designed to feed flows to the two most influential WS trading houses. A few HFs got hurt, but if retail is moving toward more trading and away from fundamentals, WS owns that game. #Stonks by design.” Jeffrey Gundlach also piled on.

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