5 takeaways from Business Insider’s investigation into Robinhood’s botched foray into checking and savings

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Millennial investing app Robinhood attempted to launch a checking and savings account with a 3% interest rate last year.
Robinhood claimed the accounts were insured, but no one checked ahead of time to see if this was actually true.
Business Insider interviewed 10 former Robinhood employees to uncover the true story about Robinhood’s failed launch.
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Robinhood, the millennial stock-trading platform that wants to democratize the financial system, announced last year that it was going to offer insured checkings and savings accounts with a 3% interest rate.

Shortly after the company’s announcement, it came to light that no one from Robinhood had actually reached out to see if that insurance would be possible.

Business Insider spoke with 10 former Robinhood employees to figure out what really happened when the company launched its checkings and savings account.

Here are the five biggest takeaways from Business Insider’s Robinhood scoop:

1. Robinhood knowingly launched its checking and savings account and told customers their money would be insured without checking with the proper regulators. When Robinhood employees warned founder Baiju Bhatt that this wasn’t the case, his response was: "Fuck it, we’re doing it anyways."

2. Bhatt told employees "we’re going to be fine" when they asked him how Robinhood could claim their product was SIPC insured when they hadn’t spoken to anyone there. According to Business Insider’ reporting, Bhatt deliberately decided not to contact the SIPC to check whether Robinhood’s products would be covered.

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3. Stephen Harbeck, the president and CEO of the SIPC at the time, said that the company never contacted his organization about the new checkings and savings product. Employees promoted the launch on their social media feeds. According to Business Insider’s sources, hours after the announcement, a company-wide email told employees to delete everything they posted about the checkings and savings account.

4. Robinhood deleted the press release announcing the product less than a day after the announcement. It was replaced with a new post from Bhatt and co-founded Vlad Tenev that said they were going to reexamine the initiative.

5. A joint letter from multiple US Senators was sent to the Securities and Exchange Commission. It was addressed to chairman Jay Clayton, Federal Deposit Insurance Corporation chairwoman Jelena McWilliams, and SIPC’s Harbeck — and it condemned Robinhood.

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