The Florida investigation accuses Robinhood of misleading consumers regarding low cryptocurrency prices. Additionally, LIBRA and OpenAI are in the news.
Florida Investigation into Robinhood
Florida Attorney General James Uthmeier has launched an investigation into Robinhood, accusing the trading platform of misleading consumers about its cryptocurrency trading services as the cheapest option on the market. Uthmeier claims Robinhood violated Florida's Deceptive and Unfair Practices Act by promoting itself in this manner.
A subpoena has been issued for various company documents. Uthmeier pointed out that cryptocurrency is a "vital component of Florida's financial future," and consumers deserve full transparency when buying and selling digital assets.
At the center of the dispute is Robinhood's use of payment for order flow (PFOF), a controversial model where brokers receive compensation from third parties for routing trades. Critics, including Uthmeier, argue this practice may lead to worse execution prices for customers, despite appearing commission-free. According to Uthmeier, "third parties that pay Robinhood for order flow might have to charge less favorable prices."
LIBRA: Creator Challenges New York Lawsuit
Hayden Davis, creator of the LIBRA meme coin, has requested a federal court in New York to dismiss a class-action lawsuit against him. He argues that the court lacks jurisdiction.
The lawsuit was brought by a group of LIBRA investors led by Omar Hurlock, who accuse Davis and his brothers of misleading the public by suggesting the token would benefit Argentina's economy. The token gained international attention after being praised by Argentine President Javier Milei, but later collapsed by 94%, causing outrage among investors.
Davis stated that continuing the case in New York would violate constitutional due process, as the suit fails to establish personal jurisdiction over him.
Midas Project Claims Violations by OpenAI
The Midas Project, a nonprofit watchdog, has filed a complaint with the IRS, accusing OpenAI of potential tax law violations that could jeopardize its nonprofit status.
The complaint alleges serious conflicts of interest in OpenAI's board, including CEO Sam Altman's dual role overseeing both its nonprofit and for-profit operations. It claims this creates a situation where Altman could personally benefit at the expense of public interest.
Midas Project also stated that OpenAI has abandoned key safeguards, misused charitable funds, and structured its board in a way that violates federal nonprofit regulations.
Investigations and legal actions in the cryptocurrency and technology sectors are becoming more frequent, raising questions about transparency and ethics in these rapidly evolving industries.
