Press X, Y, Down, Down, Left, Y, X for what has to be securities fraud.

We've been kind of hard on Robinhood, the Millennial trading video game app that allows users to lose IRL money on bad tech IPOs, but that hasn't stopped the company from amassing 3 million users, fundamentally upending the online brokerage game and trying to literally become a bank.

That said, and Bloomberg will back us up, it's still kind of pretty much a video game:

A glitch in the Robinhood Markets Inc. system is allowing users to trade stocks with excess borrowed funds, giving them access to what amounts to free money.

Dubbed the “infinite money cheat code” by users of Reddit Inc.’s WallStreetBets forum, the bug is being exploited, according to users on the forum. One trader bragged about a $1 million position funded by a $4,000 deposit.

So, it's like when you got to be Starman Mario for a whole level if you hit the right buttons on your Nintendo controller, but for using covered calls to trick a computer into giving you all the leverage a kid could as for...

Here’s how the trade works. Users of Robinhood Gold are selling covered calls using money borrowed from Robinhood. Nothing wrong with that. The problem arises when Robinhood incorrectly adds the value of those calls to the user’s own capital. And that means that the more money a user borrows, the more money Robinhood will lend them for future trading.

One trader managed to turn his $2,000 deposit into $50,000 worth of purchasing power, which he used to buy Apple Inc. puts. He subsequently lost that money and posted a video of the wipe-out on YouTube.

Sure, this is definitely securities fraud and not the primary fault of Robinhood, but it's also not great to have this going on while you're trying to convince the world that you're an adult operation worthy of beheading Charles Schwab and holding people's money in deposit accounts. It's also the kind of thing that makes Goldman Sachs rethink the obvious decision to buy you at an already less-ludicrous valuation than it would have been 8 weeks ago.

Also, it's funny as shit.

Robinhood Traders Discovered a Glitch That Gave Them ‘Infinite Leverage’ [Bloomberg]