US Senators seek information on FTX dealings from Silvergate Capital

U.S. Senators Elizabeth Warren and John Kennedy, alongside Member of Congress Roger W. Marshall, have written to Silvergate Capital Chief Executive Alan Lane seeking information on FTX and other crypto firms.

More specifically, the letter states they are looking for information on the relationship between Silvergate Bank (NYSE: SI) and several crypto firms founded by Sam Bankman-Fried, including Alameda Research LLC (Alameda), FTX US, and FTX Trading Ltd. (FTX).

The Senators state that following FTX's "shocking collapse, new and disturbing allegations about the company's business practices have continued to surface." They point to the reports that Bankman-Fried secretly transferred around $10 billion of customer funds to his trading vehicle, Alameda Research, to fund risky bets, "violating both U.S. securities laws and FTX's own terms of service."

"We are concerned about Silvergate's role in these activities because of reports suggesting that Silvergate facilitated the transfer of FTX customer funds to Alameda," the letter reads.

The letter also questions Silvergate's awareness in reporting suspicious activities carried out by its clients as required.

"Your bank's involvement in the transfer of FTX customer funds to Alameda reveals what appears to be an egregious failure of your bank's responsibility to monitor for and report suspicious financial activity carried out by its clients," the letter adds.

Silvergate has been given until December 19 to respond.

By Sam Boughedda

You May Also Be Interested In

• Piper remains bullish on this beverage stock, citing 'best-in-class execution'
• Morgan Stanley is bullish on this green energy stock
• China tech giant’s AI bet faces test as cloud growth accelerates