As much as Robinhood allows its users to utilize the platform for commission-free US stock trading, there are reasons your account may be locked. Just like every other brokerage firm, the web and mobile-friendly trading platform has in place policies that govern every account opened on the platform and if broken, there are tendencies your account may be locked. That being said, it’s important to know if Robinhood can lock your account, the reasons for your account being locked, and how to unlock the account.
If your account has been locked by Robinhood, then the reason is you’ve broken one of its account policies. As an active trader, it’s important to be aware of Robinhood’s trading policies to help you not go against them. You can reach their customer service to unlock and reactivate your account.
Your account is locked for some reason may be inconvenient and frustrating especially if you’re a very active trader. Hence, in this article, I’ll discuss how to unlock your Robinhood account and the reasons why your account was locked in the first place.
Can Robinhood Lock Your Account?
Yes, Robinhood can lock your account if you’ve broken any of their account policies. The major reason why an account is restricted is if the account owner declares themself as a “Control Person”.
Declaring yourself as a Control Person for a company typically blocks your account from trading that company’s stock. If you check your Robinhood account, you will see that you’ve been blocked from trading that Stock’s symbol. According to Robinhood, this is done for compliance reasons.
If you’re no longer a control person, or you selected this unintentionally, you can contact Robinhood’s support to revert the process.
There are also other reasons why your account may be restricted or locked. They include:
- Transfer Reversals
- Incorrect or outdated information
- Fraud inquiries
- Account levies
Why Did Robinhood Lock Your Account?
As discussed there are a number of reasons why Robinhood may lock your account. Here are possible reasons that led to your account being locked:
Doing multiple transfer reversals may lead to Robinhood locking your account as it’s against their policy. Although your account needs to be funded before you can begin trading with the account, multiple transfer reversals or failure may lead to your account being locked. Especially if you’re transferring from your bank account to your Robinhood account and it goes on to fail.
For instance, if you’re trying to transfer funds from your bank account to your Robinhood account, and you do not have enough money in your bank account, the transfer may fail. Now performing this transaction multiple times may lead to the process being seen as spam thereby leading to your account being locked.
Also, if you’re trying to transfer funds and stocks in your account to another brokerage firm like Webull for example, your account may be restricted if you have some money to pay back if you’re using the Robinhood Gold account. You need to pay up all the debt before initiating the transfer, if you don’t and you initiate the transfer, the transfer will be reverted, and reversing the transfer multiple times will lead to your account being locked.
Incorrect Or Outdated Information
If you provide outdated information while performing a transaction using your account, your account may be blocked. This information may include a change in your withdrawal bank account. If you want to withdraw to a different bank account and not the one you used to deposit into your Robinhood account, your account may be locked until you call Robinhood’s customer support to update your withdrawal info.
Usually, Robinhood updates a user’s bank information by automatically saving the bank details used to deposit into the account, so if you want to withdraw from Robinhood, the funds go directly to that bank. But once there’s a change in the bank details and you attempt to withdraw to another bank, your account will be locked. If you also provide incorrect information, your account will be locked.
For instance, while depositing with your bank card, you input incorrect information, after performing the process multiple times at its unsuccessful, your account will be locked. If you also provide incorrect information while verifying your account, your account will be locked. Accounts are locked for security reasons as Robinhood has strict security measures to protect its traders and investors.
If you make fraud inquiries, your account will be locked. If Robinhood senses fraudulent actions being taken with your account, your account will be automatically disabled until you can prove to customer support that your account is not used to make fraudulent inquiries.
For example, if you try to withdraw funds borrowed using your Robinhood gold account, firstly, the withdrawal won’t be processed, and then, your account will be locked. You need to understand these policies so you do not make these mistakes and lose your trading account
If you also have pending account levies, that you haven’t paid in a given duration, you may lose your account. The levies may include account subscription levies or transfer levies. If you’re trying to perform a withdrawal without settling those levies first, your account will be locked.
It’s important to be aware of the account levies before performing any account transactions so you don’t lose your account to levies. Always make sure to pay out your levies and debts before performing any transfers or withdrawals on your account.
If your account is a Robinhood Gold or Robinhood instant account, and your account gets locked, then you’re limited to only performing 3-day trades every week. Meaning you’re not completely restricted to not trading.
If you perform more than 3-day trades while your account is restricted or locked, then your account will be blocked for 90 days. Meaning your account will be blocked from trading and performing all other activities for 3 months.
To prevent this, you need to keep your balance on or above $25,000. You can also contact Robinhood’s customer support for more details about what to do.
How to unlock your Robinhood account.
If you have any restrictions on your account, then you may be prevented from buying some particular stocks or even banned from trading. This will lead to u being able to buy stocks or cryptocurrencies until the restriction is lifted. To lift the restrictions, you need to contact Robinhood’s customer support.
On the other hand, if you adhere to Robinhood’s policies strictly, you won’t need to bother about your account being locked as their security system won’t be triggered. This is why you need to understand Robinhood’s policies and stick to them squarely.
If your account has been locked due to policy violations, and you need to remove the restriction and unlock your account to resume trading stocks or cryptocurrencies or report an issue of any negative balance associated with your account balance, then you just simply need to contact Robinhood’s support team to resolve it.
Keep in mind that your account issues won’t be resolved and unlocked immediately, although this is highly dependent on what exactly went wrong that got your account locked.