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Silicon Valley Bank Now Under Investigation By U.S. SEC & Department Of Justice

According to reports, the Justice Department and the Securities and Exchange Commission of the United States are conducting an investigation into the failure of Silicon Valley Bank. The investigation comes after the California-based financial institution — majorly catering to venture capitalists and startups — was taken over by regulators last week in the midst of an unprecedented run on its deposits.

The independent investigations are still in the early stages at this point, and it is possible that they will not result in any indictments or accusations of malfeasance. Investigations are frequently initiated by prosecutors and authorities after large, unforeseen losses are sustained by financial institutions or public enterprises. Last week, shares of SVB Financial Group, which formerly controlled the bank, dropped by 60%, and trade in those shares has been halted since Friday.

According to information obtained, the probes are also looking into the stock sales that executives at SVB Financial made in the days leading up to the bank’s failure. The investigation being conducted by the Justice Department includes the participation of the department’s fraud prosecutors in both Washington and San Francisco.

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