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Tech News Roundup: Robinhood fined, Alibaba Warned

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Techscoops brings to you a roundup of top technology news updates around the world. Robinhood is in the news again – this time it’s a bad news. Alibaba’s failure to release some documents might be followed by a trade ban.

Read more below for all the details you need.

Regulators fine Robinhood $30 Million as quarterly revenue drops by half

This past Tuesday, Robinhood (HOOD) announced that transaction-based revenue in the second quarter of 2022 fell to $202 million from $451 million recorded in the second quarter of 2021, a drop of more than half. Overall revenue also fell by 44 percent to $318 million from $565 million a year ago.

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The company announced plans to cut almost a quarter of its staff, citing “economic uncertainty, a steep selloff in cryptocurrencies, and a deteriorating market environment”. This is the second round of layoffs for Robinhood, which reduced its workforce by about 9% in April.

Robinhood is not the only tech company to lay off staff. Shopify (SHOP), Netflix (NFLX), Tesla (TSLA), and several crypto companies have also cut their workforces amid the worsening economic outlook.

A New York financial regulator on Tuesday also fined Robinhood $30 million “for significant failures in the areas of bank secrecy act/anti-money laundering obligations and cybersecurity.”

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SEC adds Alibaba to list of Chinese companies facing delisting

The SEC on Friday added Alibaba (BABA) to a list of Chinese companies that will be banned from trading if they do not provide access to audit files. China has blocked its companies and accountants from providing foreign regulators with access to audit files, despite US laws that require them to be inspected every three years.

As a result, the SEC has been adding Chinese groups to its list of companies in breach of audit disclosure rules as they file their 2021 annual reports. The SEC action has added to regulatory pressure on Alibaba, which has been caught in the middle of growing US-China tensions and has been hit by Beijing’s crackdown on the technology sector.

This news caused an 11 percent drop in the company’s New York-listed shares and 3 percent drop shares in its Hong Kong-listed shares. The fate of Alibaba’s New York listing will rely on an agreement between Beijing and Washington for China to permit the US to access audit files.

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