|Robinhood has also run afoul of regulators as it rushed to release new products. In December 2018, the company said it would offer a checking and savings account that would be insured by the Securities Investor Protection Corporation, or S.I.P.C., which protects investors when a brokerage firm fails.|
But S.I.P.C.’s then-chief executive said he hadn’t heard about Robinhood’s plan, and he pointed out that the S.I.P.C. doesn’t protect plain-vanilla savings accounts — that would be the job of the Federal Deposit Insurance Corporation. It took almost a year for Robinhood to reintroduce the product, saying in a blog post that it “made mistakes” with its earlier announcement.
If this is really true, then I wouldn't trust a penny to these guys. The difference between FDIC and SIPC is pretty dang basic. It is part of the series 7 that every new broker must take.