Justice Department and SEC Investigate Silicon Valley Bank Collapse
Phil Mattingly, CNN
According to people familiar with the matter, the US Department of Justice and the Securities and Exchange Commission are launching an investigation into the collapse of Silicon Valley Bank.
The federal investigation is in its preliminary stages, the source said, looking into both the bank’s failure and senior management’s actions that led to federal regulators’ decision to shut down the lender last week.
To date, no individual has been charged with any wrongdoing, and a person familiar with the matter noted that investigations into significant events such as the collapse of Silicon Valley Bank are commonplace.
SEC Chairman Gary Gensler, while declining to name any specific institution, appeared to hint at a likely move in a statement on Sunday.
“Without contacting any person or entity, we will investigate and take enforcement action if we find violations of federal securities laws,” Gensler said in a statement.
The Justice Department did not respond to CNN’s request for comment.
The Biden administration took an extraordinary step Sunday to restore confidence in America’s banking system and ensured that customers of the failed Silicon Valley bank would have access to all their money starting Monday. By guaranteeing all deposits—even the uninsured money that customers kept in failing banks—the government sought to prevent new bank runs and to help companies that placed large amounts of money in banks continue to earn wages and finance their operations.
This did not stop the aftershocks from the crash affecting markets around the world. However, US stocks rose on Tuesday as bank stocks rebounded. The moment of crisis may have passed, but the banking sector and the economy remain at the knife’s edge.
— Paula Reid contributed to this report.
The-CNN-Wire
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A message from the Department of Justice and the Securities and Exchange Commission is investigating the bankruptcy of a Silicon Valley bank first appeared on KION546.
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