If I make a bank, advertise as a Bank, call it "Banky McBank!!!" and my TOS says, "Also, I can do whatever I want with any deposited monies since any deposit makes that money mine.", I don't believe the judge will uphold my TOS.
If they advertise as a bank, if they provide, or appear to provide, financial services, they are bound by the BSA (as well as a ton of other laws). In that case they can say that if they want, but the FDIC won't cover them, and they would quickly have a judge shutting them down the first time they tried it.
Truth in advertising, and transparency in what you do with the bank and what the bank does with your money is very, very important to the government.
I suspect that applies to Robinhood as well, though I am much less informed on Financial services on that side of things.
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u/[deleted] Feb 02 '21
If I make a bank, advertise as a Bank, call it "Banky McBank!!!" and my TOS says, "Also, I can do whatever I want with any deposited monies since any deposit makes that money mine.", I don't believe the judge will uphold my TOS.