Fun

SEC files lawsuit against FTX-linked bank, alleging fraud

News Feed - 2024-07-02 06:07:42

Turner Wright2 hours agoSEC files lawsuit against FTX-linked bank, alleging fraudEnforcement director Gurbir Grewal said Silvergate allegedly “failed to detect nearly $9 billion in suspicious transfers among FTX and its related entities.”1075 Total views1 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksThe United States Securities and Exchange Commission (SEC) has filed a lawsuit against Silvergate Capital Corporation, the parent company behind a crypto-friendly bank that allegedly helped facilitate fraud at defunct exchange FTX.


In a July 1 filing in the U.S. District Court for the Southern District of New York, the SEC alleged that Silvergate, former CEO Alan Lane, and former Chief Risk Officer Kathleen Fraher misled investors regarding the strength of its Bank Secrecy Act/Anti-Money Laundering compliance program and the “monitoring of crypto customers” like FTX.


The regulator also charged former Silvergate Chief Financial Officer Antonio Martino with “misleading investors about the company’s losses from expected securities sales following FTX’s collapse.” All parties, except Martino, have agreed to settle with the SEC.


“The allegations made by the SEC are unfounded and irresponsible, and I look forward to presenting my case in court and clearing my name,” said Martino, according to a statement to Cointelegraph provided by his attorneys at law firm Linklaters.


According to SEC enforcement director Gurbir Grewal, Silvergate allegedly “failed to detect nearly $9 billion in suspicious transfers among FTX and its related entities,” leading to massive losses for investors. He alleged the firm and its executives “doubled down” on misleading investors following FTX’s collapse from November 2022 to January 2023.Source: U.S. Securities and Exchange Commission


The SEC said Silvergate had agreed to pay a $50 million civil penalty “without admitting or denying the allegations,” while Lane and Fraher agreed to pay $1 million and $250,000, respectively. The settlements will be subject to court approval. The commission’s enforcement action came i parallel to a settlement between Silvergate and the Board of Governors of the Federal Reserve System and the California Department of Financial Protection and Innovation.


Related:Cash or crypto? FTX creditors to vote on how they’re paid back


Silvergate voluntarily liquidated in March 2023 after several crypto firms announced they intended to cut ties to the bank, alleging links to FTX. Crypto exchange FTX collapsed and filed for bankruptcy in November 2022, resulting in criminal charges against several executives, including former CEO Sam Bankman-Fried, currently serving a 25-year sentence in federal prison.


The complaint stated that under Bankman-Fried, FTX had “directed customers to wire money to Alameda’s account with Silvergate in exchange for assets” on the crypto exchange. The former CEO also provided a testimonial for the crypto-friendly bank’s website, claiming it “revolutionized banking for blockchain companies.”


The SEC action also followed a judge signing off on a class-action lawsuit filed by FTX users against Silvergate, alleging that the bank had been aware of fraudulent activity at the crypto exchange. The company has denied the allegations.


On June 27 and 28, the U.S. Supreme Court released two opinions that could affect how the SEC handles crypto enforcement cases. One opinion held that defendants in SEC civil cases concerning securities fraud are entitled to a jury trial.


Magazine:Godzilla vs. Kong: SEC faces fierce battle against crypto’s legal firepower# Fraud# Law# Banks# SEC# Regulation# SilvergateAdd reaction

News Feed

Bitcoin, Ethereum Technical Analysis: More Crypto Price Uncertainty Heading Into the Weekend
Bitcoin, Ethereum Technical Analysis: More Crypto Price Uncertainty Heading Into the Weekend Bitcoin consolidated on Friday, as prices hovered marginally below the $40,000 level. T
Bitcoin, Ethereum Technical Analysis: ETH Drops Below $1,600 Following Completion of The Merge
Bitcoin, Ethereum Technical Analysis: ETH Drops Below $1,600 Following Completion of The Merge Ethereum fell below $1,600 on Thursday, despite the successful completion of the high
Ezra Reguerra20 hours agoBreaking down the ongoing token impersonation scams with DeFi execsTres Finance co-founder Tal Zackon warned businesses not to use explorers when tracking their finances.4111 Total viewsListen to
Libra Could Drop ‘Basket’ and Issue Individual Fiat Stablecoins
The Facebook-led Libra project may consider a fundamental change to the way its planned global payments system will operate, according to its chief. Speaking at a banking seminar, a
EU Targets Crypto Assets in Widened Sanctions Against Russia, Belarus
EU Targets Crypto Assets in Widened Sanctions Against Russia, Belarus The European Union is extending the scope of sanctions introduced in response to Russia’s invasion of U
Upland and FIFA Officially Launch the FIFA World Cup Qatar 2022™ Experience in The Upland Metaverse
Upland and FIFA Officially Launch the FIFA World Cup Qatar 2022™ Experience in The Upland Metaverse sponsored FIFA and Upland have agreed to a multi-year partnership, starting with the FIFA World Cup Qatar 2022™ The
BlackRock Bitcoin ETF posts September's biggest daily inflow of over $180M
Ciaran Lyons12 hours agoBlackRock Bitcoin ETF posts September"s biggest daily inflow of over $180MBlackRock"s Bitcoin ETF saw the highest daily inflow of any fund this month on Sept. 25, amid a wider five-day inflow stre
40 Million Troy Ounces: Russia’s Gold Find Reaffirms Bitcoin as the More Scarce Asset
40 Million Troy Ounces: Russia"s Gold Find Reaffirms Bitcoin as the More Scarce Asset News of the discovery of approximately 40 million troy ounces of gold in Ru
Bahamians didn't want CBDCs — So now they're being forced to use them
Nicholas Anthony4 hours agoBahamians didn"t want CBDCs — So now they"re being forced to use themRegulators in the Bahamas are sick of their citizens" reluctance to adopt a CBDC, so they"re forcing commercial banks to g
‘Disable iMessages’ ASAP to avoid crypto zero-day exploit: Trust Wallet
Brayden Lindrea8 hours ago‘Disable iMessages’ ASAP to avoid crypto zero-day exploit: Trust WalletThe firm’s CEO, Eowyn Chen, shared a screenshot of the supposed “high-risk” exploit being sold on the dark web fo
Andrew Singer10 hours agoWill BlackRock’s ETF slingshot Bitcoin’s price skyward?Have the world’s largest financial firms finally “seen the light” with Bitcoin? Will demand outstrip supply, making a BTC price ri
Biggest Movers: SOL Hits 1-Month Low on Saturday, as UNI Extends Recent Declines
Biggest Movers: SOL Hits 1-Month Low on Saturday, as UNI Extends Recent Declines Solana fell to a one-month low to start the weekend, as cryptocurrency markets moved lower ahead of