SEC, DOJ investigating Silicon Valley Bank: WSJ
Two U.S. regulators have begun an early investigation into the failed Silicon Valley Bank (SVB), according to a report from the Wall Street Journal on March 14.
SEC, DOJ reportedly investigating SVB
SVB was closed by California financial regulators and taken over by the Federal Deposit Insurance Corporation (FDIC) on March 10.
Now, two other agencies — the U.S. Securities and Exchange Commission and the U.S. Department of Justice (DOJ) — are probing the failed depository institution.
Those investigations concern the nature of the bank’s failure as well as stock sales that executives carried out before the crisis. Previous reports suggested that three executives including CEO Gregory Becker sold millions of dollars of stock.
The DOJ’s investigations reportedly involve the department’s fraud prosecutors, which implies that the bank could face fraud-related charges.
However, both probes are in their early phases and will not necessarily lead to charges or allegations. Neither agency has publicly confirmed any probe.
U.S. entities look into collapse
Various other U.S. entities are also looking into the collapse of SVB. Regulators in one state, Massachusetts, are also looking into the bank’s collapse due to the high number of tech startups served by SVB within its borders.
Elsewhere, the U.S. Federal Reserve will review its own oversight of SVB prior to its collapse. Critics, however, suggest that the agency is unfit to examine itself.
Senators on both sides of the political aisle have also called for investigations into the bank’s collapse — including Senator Elizabeth Warren.
Meanwhile, U.S. President Joe Biden attempted to reassure the public on March 13 as he stated that failed customers can “have confidence” in the banking system.
The President has implemented emergency measures in cooperation with the FDIC, Federal Reserve, and Treasury. Those measures will allow SVB users to regain access to all of their funds — not just those funds that are insured by the FDIC.