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The
Commission alleged that the company made a "fraudulent scheme"
to mislead investors about its bank secrecy and anti-money
laundering compliance programs as well as its "dire financial
condition", after the collapse of crypto exchange FTX in
November 2022.
"The bank also failed to detect nearly $9 billion in suspicious
transfers by FTX and its related entities," the SEC alleged.
Reuters could not independently verify the claims in the court
filing by the SEC.
Silvergate did not immediately respond to a Reuters request for
comment.
In March 2023, Silvergate, which ventured into crypto in 2013,
decided to wind down operations and voluntarily liquidate
following losses due to the panic that ensued after FTX
collapsed.
The bank, founded in 1988, had disclosed it sold additional debt
securities in 2023 at a loss and that further losses meant the
bank could be "less than well capitalized" before plans of
shuttering it came to light.
(Reporting by Pritam Biswas in Bengaluru; Editing by Mohammed
Safi Shamsi)
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