Silvergate Bank didn't adequately monitor $1 trillion in crypto transactions, SEC says
How much did Silvergate agree to pay to settle the charges?
Silvergate agreed to pay $63 million to settle the charges, with $50 million going to the U.S. Securities and Exchange Commission (SEC), $43 million to the Federal Reserve, and $20 million to the California Department of Financial Protection and Innovation3.
What is the SEN network and its significance in the allegations?
The SEN network, or Silvergate Exchange Network, was a payment platform operated by Silvergate Bank that enabled its crypto clients to transact with each other 24/7. It played a significant role in the SEC's allegations as the regulator claimed that the bank did not adequately monitor the network for suspicious transactions, despite assuring investors of its safety and compliance.
What allegations did the SEC make against Silvergate Bank?
The SEC alleges that Silvergate Bank misled clients and investors about the effectiveness of its compliance programs, including anti-money laundering efforts, and misrepresented the company's financial condition during a liquidity crisis following FTX's collapse16. The suit names former CEO Alan Lane, former Chief Risk Officer Kathleen Fraher, and former Chief Financial Officer Antonio Martino as defendants.