US Justice Department investigators in Washington and Manhattan were examining whether the now-collapsed bank took steps to detect possible money laundering by its clients.
US prosecutors were investigating Signature Bank’s association with clients of cryptocurrencies before regulators suddenly intervened in the lender last weekend, Bloomberg News reported Tuesday, citing people familiar with the matter.
Investigators with the US Department of Justice in Washington and Manhattan were examining whether the now-collapsed bank took steps to detect possible money laundering by its clients.according to the report, adding that the Securities and Exchange Commission (SEC) was also looking at the bank.
The report comes after the New York financial regulator earlier said its decision to shut down Signature Bank had “nothing to do with cryptocurrency” but was spurred by what it called “a major crisis of confidence in the bank leadership” following the collapse of Silicon Valley Bank (SVB).
The Federal Deposit Insurance Corporation (FDIC), which has taken control of the lender, declined to comment on the information.
Signature Bridge Bank, operated by the FDIC and set up after state regulators shut down Signature Bank, also declined to comment.
The SEC and Justice Department did not immediately respond to Reuters’ request for comment.
State regulators closed New York-based Signature Bank on Sunday, the third-biggest bankruptcy in US banking history, and two days after authorities shuttered Silicon Valley Bank (SVB) in a collapse that stranded thousands of millions in deposits.
In September, nearly a quarter of Signature Bank’s deposits came from the cryptocurrency sector, but the bank announced in December that it would reduce its cryptocurrency-related deposits by $8 billion.
Source: Ambito
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