According to a March 14 Wall Street Journal report, two US regulators have launched early investigations into the failed Silicon Valley Bank (SVB).
SEC, DOJ Reportedly Investigating SVB
The SVB was closed by California’s financial regulators and was taken over by the Federal Deposit Insurance Corporation (FDIC) on March 10.
Two agencies, the US Securities and Exchange Commission and the US Department of Justice (DOJ), are currently investigating failed depository institutions.
These investigations relate to the nature of bank failures and stock sales made by management prior to the crisis. Earlier reports suggested that three of his executives, including CEO Gregory Becker, sold multi-million dollar stakes.
The DOJ investigation reportedly involved the department’s fraud prosecutor, which means the bank could face fraud-related charges.
However, both investigations are in their early stages and may not necessarily lead to indictments or allegations. Neither agency has publicly acknowledged the investigation.
US Entities Consider Collapse
Various other US entities are also investigating the collapse of the SVB. Regulators in one state, Massachusetts, are also investigating bank failures due to the high number of tech startups his SVB serves within its borders.
Elsewhere, the US Federal Reserve will review its own oversight of the SVB before it collapses. Critics, however, suggest that the institution is unfit to examine itself.
Senators on both sides of the political corridor asked for an investigation to the collapse of a bank involving Senator Elizabeth Warren;
Meanwhile, US President Joe Biden tried to reassure the public on March 13 that failing customers can have “confidence” in the banking system.
carried out by the president first aid Working with the FDIC, Federal Reserve, and Treasury Department. These actions will allow SVB users to regain access to all funds, not just those insured by the FDIC.
