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Robinhood removed GameStop and other companies from its trading platform in January amidst an “unprecedented stock rise” following an organized campaign on Reddit to target the shares. (Photo: TyLim/Shutterstock) Robinhood removed GameStop and other companies from its trading platform in January amidst an “unprecedented stock rise” following an organized campaign on Reddit to target the shares. (Photo: Ty Lim/Shutterstock)

Recent stock market volatility caused by the frenzied trading of GameStop, AMC Theatres and other shares could spur a wave of shareholder ligation and worsen social inflation, according to AM Best.

Frustrated investors have already filed class-action lawsuits against Robinhood after it restricted trading of the stocks made popular on the WallStreetBets Reddit forum, allegedly to help Citadel Securities, one of the brokerage’s largest investors. AM Best expects many more lawsuits will soon follow.

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Heather A. Turner

Heather A. Turner is the managing editor of ALM's NU Property & Casualty Group. She can be reached at [email protected].

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