- The lawsuit also includes two members of SVB’s top management.
- CEO and CFO of the organization are accused of negligence and concealment of information
- Allegedly, it was their decisions that led to the collapse of the bank
- This is the first lawsuit since SVB closed on March 10.
Last Friday, March 10, SVB Bank suspended its activities by decision of the authorities in California. Soon, some shareholders reported fraud on the part of the organization and its top management. This discontent poured out in a class action lawsuit.
It features not only the bank’s parent company, but also its CEO Greg Becker and CFO Daniel Beck. The latter are accused of concealing information about the increased potential risks and vulnerability of the bank to panic in the market.
In addition, the shareholders argue that it was the erroneous decisions of Becker and Beck that led to such a deplorable result. The defendants have not yet commented on the situation.
This is the first, but most likely not the last lawsuit against Silicon Valley Bank. And can it be called hasty or unjustified? Recall that shortly before the collapse, the CEO of SVB spoke to shareholders with the assurance that the situation was stable.
According to unconfirmed reports, at the time of liquidation, the volume of unrealized losses of the bank exceeded $16 billion. And although the federal authorities guarantee the return of deposits, the bankruptcy of such a large financial counterparty will hit the market anyway.
And just a few days before that, Silvergate Capital went to the bottom. In a separate article, we considered the possible consequences of the liquidation of such banks.
