Featured Story
BanksterCrime:
The US bank regulator is mulling legal action against former SVB executives.
WASHINGTON, December 17 (Reuters) The chairman of a major US banking regulator announced Tuesday that his agency is considering legal action against six former officers and eleven former directors of Silicon Valley Bank.
Chairman of the Federal Deposit Insurance Corporation, Martin Gruenberg, said in a statement that the agency was considering suing the former bank executives, who were not named, for “breaches of duty” in mismanaging Silicon Valley Bank’s portfolio prior to its abrupt collapse last spring.
Gruenberg, a Democrat appointed by President Joe Biden, has stated that he intends to retire from the agency on January 19. However, the decision to authorize prospective legal action was unanimously accepted by the FDIC board, which comprises both Democrats and Republicans.
The FDIC took over Silicon Valley Bank (SVB) in March 2023 after the bank experienced a significant run on its deposits after announcing that it needed to raise more capital to cover portfolio losses. Gruenberg stated in his prepared statements, delivered during a closed meeting of the FDIC board, that the bank’s leadership mismanaged key parts of the bank’s finances, resulting in its failure.
To prevent a broader panic in the banking industry, the FDIC was authorized to guarantee all of the bank’s deposits, including huge amounts of uninsured deposits, at a cost of an estimated $23 billion to its deposit insurance fund.
“As a result of the mismanagement… SVB suffered billions of dollars in losses for which the FDIC as Receiver has both the authority and the responsibility to recover,” according to the statement he issued.
Though meeting chair Luis Vayas Valdivieso attempted to strike a cheerful tone:
Gruenberg previously testified before Congress that the FDIC was looking into suspected misbehavior by SVB management.The FDIC has previously pursued legal action against executives of bankrupt banks. According to the FDIC’s website, the agency recovered $4.48 billion from executives of insolvent banks under its professional liability program between 2008 and 2023.
Don't Miss
Incentives (And Sociopaths) Rule The World
Ryan Murphy, an economist at Southern Methodist University, recently published a working paper in which he ranked each of the states by the predominance of—there’s no nice…
Federal Reserve Chair Jerome Powell Insists There Won’t Be A Recession When All The Evidence Suggests Otherwise
It’s happening again. Just like last time around, the head of the Federal Reserve is telling us that there won’t be a recession even though…
Blain: “Central Banks Are No Longer A Solution – They Have Become The Risk”
“A faithful man will be richly blessed, but one eager to get rich will not go unpunished.” This speaks against the “get-rich-quick” mentality. Looking at…
A brief history of crime, corruption, and malfeasance at American banks
Corruption is a state of decay, pollution, or incorrectness. In the Bible, corruption is one of the effects of sin that resulted from the fall…
The End Of The Dollar As We Know It?
These same money changers were associated with others who engaged in shady business practices in the temple courts. Some sold sacrificial animals, overcharging people who did…
