Regulation

Could free shares land Robinhood in trouble with companies and regulators?

Small firms are arguing free share giveaways add to their costs as Finra reviews proxy materials rules

Robinhood has for years given customers a free share of stock for opening an account or referring friends. The practice could soon cost the online brokerage a lot more money.

Brokerages like Robinhood are required to deliver proxy materials to a public company’s shareholders ahead of annual meetings. They are then reimbursed by the public company for the cost of distribution.

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