#Shorts
Robinhood Markets Inc. has for years given customers a free share of stock for opening an account or referring friends. 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 at a rate of 25 cents per distribution.
This means that Robinhood’s stock giveaways have saddled some companies with larger bills for delivering proxy statements. Now, the practice is sparking a backlash from companies and scrutiny from market regulators.
One company pushing back is Catalyst Pharmaceuticals Inc., which says Robinhood’s program cost it almost $250,000 last year and could be even more expensive this year.
$HOOD
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