I'm familiar with KYC. KYC is actually the very reason why Robinhood customers should not be required to re-verify their identity because it stipulates that institutions both acquire and retain the identity information of their customers.

With that said, my qualms are not with the fact that I had to re-verify; simply the manner in which it happened.

The fact that they re-requested my identity tells you that this verification process was not in support of their KYC obligation, but likely a fraud-prevention mechanism. Which puts the manner in which it happened entirely within their control from a product perspective.

So KYC them when you onboard them, NOT when they try to withdraw.

“Oh no, that might hurt our signup and trading figures?! “

Well, DUH, but anything to fudge the numbers right?!

Maybe if they make withdrawals even more difficult a percentage of users will abandon and then our assets under management numbers look better.

This is exactly what’s happening, stop forgiving the dark pattern behaviour under the guise of compliance.

That's why you should always start with small amounts, deposit $10, withdraw $10. If it works, repeat with $100 etc. Never keep large amounts there, withdraw as soon as trade is complete.

Alternatively, use a brokerage that's been around for decades and doesn't employ these dark patterns.

I agree, though these can deteriorate too. I've been with Vanguard for a while but was astounded as to how much the site and the customer support had degraded. Kind of worried about them but not enough to take a capital gains hit likely necessary to transfer the funds.

You can probably do an in-kind transfer (see [0] and the 4th FAQ at [1]) to another brokerage with no capital gains hit because you’re not actually selling the asset.

[0] https://finance.yahoo.com/news/kind-transfer-134617847.html [1] https://investor.vanguard.com/account-transfer/other-transfe...

You can do an in-kind transfer to move the assets over to a new firm without having to sell first. Definitely works for cash, stocks, mutual funds, and bonds. Not sure what else you can do it for

You don't need to liquidate and realize capital gains.

Weird how they let you fund your account and make trades, then, but only have an issue upon withdrawal.

If you want to read that in the most favourable light, perhaps that's more AML/CTF regs. You can't be laundering money or funding terrorism until you try and get cash _out_ of your account.

But like others are saying, there's ample evidence that Robinhood are despicable, so they sure as hell don't deserve and favourable interpretations of their trashier policies...

Obfuscating how the money enters the system and is transferred is a crucial part of laundering, so I'd disagree that laundering only happens upon withdrawal.

”Weird”. It’s an intentional UX design/friction thing. Hopefully their lawyers signed off on the interpretation of anti-money laundering laws is that they don’t count until the user tries to withdraw money.

Yes, that was the subtext of my choice of words.

Defining this acronym:

> Know Your Customer (KYC) are a set of standards used within the investment and financial services industry to verify customers, their risk profiles, and financial profile.

https://www.investopedia.com/terms/k/knowyourclient.asp

Calling KYC a set of standards is a bit if a misnomer. KYC checks are a legal requirement in the banking industry.