Robinhood Now Becomes Center of Allegations in Illegal Short Selling
Robinhood has now become the center of allegation relating to illegal short selling, particularly ‘naked short selling’ in the latest scandal.
As tensions rise in the financial markets, retail investors are buzzing with speculation that major trading platforms like Robinhood and Fidelity may soon find themselves entangled in a new wave of lawsuits related to alleged wrongful trading practices.
The focus of this speculation centers on Genius Group (NYSE American: GNS), an AI-powered education company, which has signaled its intent to pursue legal action against entities involved in alleged naked short selling and spoofing of its stock.
The developments, reported today by X Market News, have reignited debates reminiscent of the 2021 GameStop short squeeze, where similar accusations led to significant legal and regulatory scrutiny.
According to a post on X by X Market News (@xMarketNews) on June 18, 2025, Genius Group has provided an update on its ongoing legal efforts.
The post includes a statement from Wes Christian of Christian Attar, the legal team representing the company: “Furthermore, in relation to the Company’s lawsuit alleging naked short selling and evidence of spoofing, Wes Christian of Christian Attar has provided the Company with an update that the legal team is in the process of completing the investigation and updated damages report and anticipates the lawsuit will be filed in the coming weeks”.
This announcement has fueled speculation among retail investors that platforms like Robinhood and Fidelity, which have recently restricted buy orders for GNS stock, could be targeted in the impending litigation.
Robinhood and Fidelity Restrict Buying, Again
The controversy escalated when Fidelity blocked buy orders for Genius Group stock last week, a move followed by Robinhood imposing similar restrictions in recent days.
Some investors continue to report difficulties purchasing GNS shares, a situation that echoes the 2021 GameStop saga when Robinhood halted trading, prompting widespread accusations of market manipulation and leading to multiple class-action lawsuits.
Today’s developments by the retail investor community highlight this parallel, as noted, “Last week, Fidelity blocked buy orders for the companies stock & Robinhood did the same recently with some investors still experiencing being unable to purchase shares of GNS stock”.
Retail investors have taken to X to voice their concerns and frustrations.
One user, @exckman, posted “Why are you up to your old tricks turning off the BUY BUTTON?!??!!?!? You’re a shady as fuck trading platform!!!!!”.
Another, @ReginaldLarson, called for intervention, stating, “President Sir, are you not seeing this?
Please stop market corruption!!
AMERICANS KNOW! @POTUS @realDonaldTrump @DOGE @DevinNunes @PaulAtkinsETH[.]
Retail investors DEMAND complete TRANSPARENCY AND JUSTICE!!!”.
These sentiments reflect a growing distrust among retail traders, who see the buy order restrictions as potentially protecting institutional investors at their expense.
Also Read: Ken Griffin Now Says Retail Investors Will Never Beat The Pros
Naked Short Selling is No Longer A Myth
Naked short selling, the practice of selling shares that have not been borrowed or ensured to exist, and spoofing, the manipulation of market prices through fake orders, are at the heart of Genius Group’s allegations.
The company’s legal team, led by Wes Christian, is reportedly finalizing an updated damages report, with potential claims ranging from $251 million to $263 million, as noted in prior statements (GlobeNewswire, Genius Group RICO Lawsuit, 2025).
The involvement of high-profile trading platforms like Robinhood and Fidelity in restricting trades has led some to speculate that these firms could be implicated if the lawsuit expands to include entities accused of facilitating or benefiting from such practices.
The timing of the legal action, expected within weeks, adds urgency to the situation.
Retail investors, emboldened by past victories against hedge funds during the GameStop episode, are actively discussing strategies on platforms like X.
User @CURTUSCO posted, “BREAKING ROBINHOOD BLOCKS BUY ORDERS FOR GENIUS GROUP STOCK $GNS… Someone is in TROUBLE ”, suggesting a coordinated effort to capitalize on the perceived vulnerability of short sellers.
Meanwhile, some investors have managed to bypass restrictions, with @Racso714 sharing, “I grabbed a few just because fidelity and Robinhood are not allowing orders lol”, alongside a screenshot of a successful purchase.
As the investigation nears completion, the financial community watches closely.
If Robinhood and Fidelity are named in the lawsuit, it could mark another chapter in the ongoing battle between retail investors and traditional financial institutions.
The outcome may also prompt further regulatory scrutiny, echoing the calls for transparency and justice that dominated the 2021 market upheaval.
For now, the speculation on X suggests that retail investors are preparing for a potential showdown, with Genius Group’s legal team poised to file its complaint in the coming weeks.
But I’m curious to know what you think — leave your thoughts below.
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