DOJ and SEC to probe SVB collapse and insider stock sales: Report

Mar 14. 2023

By Felix NG

The investigations are separate from one another but will both look into Silicon Valley Bank's collapse and stocks sold by executives prior to its fall.

The United States Justice Department and the Securities Exchange Commission have reportedly launched inquiries into the sudden collapse of Silicon Valley Bank, which was shuttered by regulators last week amid a historic bank run. 

According to “people familiar with the matter” — as cited in a March 14 report by The Wall Street Journal — the probes will look into events that led to the bank's collapse, along with the stock sales that SVB financial officers undertook in the weeks leading up to the closure.

Securities filing show the bank’s CEO, Greg Becker, and chief financial officer, Daniel Beck, sold shares two weeks before the bank’s failure, sparking outrage from some observers.

Becker sold $3.6 million worth of shares on Feb. 27, while Beck sold $575,180 in stocks that same day, according to Newsweek. In total, SVB executives and directors cashed out $84 million worth of stock over the past two years, CNBC reported.

The probes are, however, in the early stages and may not lead to charges or allegations of wrongdoing, the sources said.

Another person with direct knowledge of the situation, quoted by NPR, said a formal announcement from the Justice Department is expected in the coming days.

Cointelegraph contacted the SEC and the Justice Department but did not receive an immediate response.

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