Reps. Waters, McHenry Will Hold GameStop Hearing After They Took Max Contribution from Robinhood CEO
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Robinhood CEO Vladimir Tenev contributed the maximum amount allowed under federal law last year to leaders of the House Finance Committee, according to federal records.
Tenev made a $2,800 contribution to North Carolina Rep. Patrick McHenry, the committee’s top Republican, on Oct. 21, according to Federal Election Commission records viewed by Mediaite. He contributed another $1,200 to Innovation Political Action Committee, a group affiliated with McHenry, in addition to giving $2,800 to WinRed, a fundraising platform connected to the Republican National Committee,
On the same day, he donated $2,800 to People Helping People, a PAC affiliated with Rep. Maxine Waters, the California Democrat who chairs the House Finance Committee. He gave $2,800 directly to Waters’ campaign four days later.
Robinhood became the center of controversy this week after members of Reddit’s “WallStreetBets” forum fueled a precipitous rise in stock prices for companies that included GameStop and AMC Theatres. Hedge funds that bet heavily on stock prices falling lost an estimated $20 billion on the increase, leading to outrage from institutional investors. Robinhood prohibited users from buying stock in the affected companies on Thursday, and allegedly sold shares belonging to some investors prior to informing them of the move.
Waters said in a Thursday statement that she would convene a hearing for her committee to learn more about the issue, but notably avoided naming Robinhood, instead taking aim at hedge funds whose “unethical conduct” she said was responsible for “recent market volatility.”
Asked by Mediaite whether Waters would return Tenev’s contribution or if she could provide any insight into it, a spokesperson for Waters pointed only to her initial statement announcing that she would convene a hearing. Taylor Theodossiou, a spokesperson for McHenry, said their boss could remain impartial despite the cash. “Rep. McHenry’s official actions have nothing to do with his political activities,” Theodossiou said.
Aside from supporting Waters and McHenry, scant evidence exists to hint at Tenev’s political proclivities. An American-Bulgarian, Tenev noted in a 2017 interview that he spent the first few years of his life in Communist Bulgaria until, at 5 years old, he and his family moved to the United States, where his parents worked for the World Bank.
Tenev argued in a Thursday CNBC interview that his company was forced to limit trading this week long enough to tap into credit lines to meet the regulatory requirements for facilitating volatility. “With a lot of concentrated activity in some of these stocks, we need to deposit more money at our clearinghouses to allow for that activity to continue.” Tenev said.”By drawing on our credit lines, which we do all the time, as part of normal day-to-day operation, we get more capital that we can deposit with the clearinghouses. And that will allow us to enable ideally more investing with fewer restrictions.”
“We absolutely did not do this at the direction of any market maker or hedge fund or anyone we route to or other market participants,” he added.
