Sources tell FOX Business’ Charlie Gasparino that any regulatory case would be difficult unless money is changing hands.
The trading app Robinhood and online broker Interactive Brokers are restricting trading in certain securities because of the recent volatility in a number of stocks.
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Shares of AMC Entertainment Holdings, BlackBerry Ltd., Bed Bath & Beyond Inc., Express Inc., GameStop Corp., Koss Corp., Naked Brand Group and Nokia Corp. have been restricted to “position closing only,” Robinhood said in a blog post.
The decision means traders cannot initiate new positions in shares of those companies and can only sell existing holdings. The company also raised margin requirements for certain securities.
Interactive Brokers on Tuesday shifted options trading in AMC, BlackBerry, Express, GameStop, and Koss to “liquidation only.”
The decisions come after shares of the companies have skyrocketed in recent weeks after members of a Reddit group called WallStreetBets banded together to squeeze short-sellers out of their positions.
Both Robinhood and Interactive Brokers are taking heat for their decisions on Twitter.
“So are @robinhoodapp and @IBKR ending trading in #wallstreetbets stocks because they are losing their ass on these trades? Or maybe they dont have the cash to enable the trades at this scale?” asked Dallas Mavericks owner Mark Cuban “Anyone have any insight on their economics?”
Barstool Sports founder Dave Portnoy said, “Somebody is going to have to explain to me in what world @RobinhoodApp and others literally trying to force a crash by closing the open market is fair? They should all be in jail.”
This is a developing story. Check back for updates.
