Signature Bank Accused of Money Laundering, Evidence Emerges
As the United States banking industry continues to witness massive bankruptcy over the past few weeks, major banking, and financial houses have continued to close down. The latest report coming from the sector says that the current situation has attracted the attention of the government, and they are currently working with relevant institutions, most of which are private establishments, to look into what may have triggered such a scenario.
In the course of the investigation, a case of fraud arose, which according to sources, was caused by some cryptocurrency clients. As of the time of this report, Signature Bank is under investigation for cases associated with money laundering. Investigations into this development show that the case had already started before the bank’s unfortunate collapse.
Account from the authorities says that Signature Bank, which is a New York-based lender, collapsed a few days after Silicon Valley Bank. It was also stated that the criminal investigations had already gone halfway before the United States regulators ceased them.
Also, recall that Bloomberg media had revealed this corrupt practices within the bank before its collapse. But as it stands, financial crime experts from the United States Justice Department, Washington, and their Manhattan counterparts are analyzing the circumstances behind the failed banks. This is where the case of money laundering was exposed.
In the cause of this investigation, these money laundering activities were linked to some particular bank customers, reports confirmed. As it stands, more regulatory and anti-graft authorities have taken an interest in the case. One such authority is the Securities and Exchange Commission (SEC), which has started scrutinizing the management and senior staff of the bank since they got involved.
How Signature Bank’s Troubles Started
Research into the origin of this latest investigation by the United States authorities was said to have started a few days after the authorities announced that their reason for closing down Signature Bank isn’t linked to crypto or its related crimes. It was quoted saying that it resulted from a major crisis in the bank’s leadership immediately after the Silicon Valley Bank collapsed.
Further revelation also shows that as of September last year, significant deposits in Signature Bank were linked to cryptocurrency. Meanwhile, in December 2022, the bank announced that it would cut down on its cryptocurrency deposits by $8 billion. This was in a desperate effort to curtail the activities of these fraudsters leveraging some features of crypto to launder funds.
In yet another development, the United States Federal Deposit Insurance Corporation is yet to comment on this trend. But rumor has it that they are directly involved in the investigation and are currently in charge of the bank’s operations pending final resolution from the authorities. Meanwhile, the Federal Deposit Insurance Corporation is not the only one who is mute about the situation; as it stands, both the Security and Exchange Commission and the embattled Signature Bank are yet to make an official statement about the situation on the ground.
A Brief Insight Into The Operations of Signature Bank
Recall that Signature Bank was once named one of the top 10 biggest banks in the United States before its travails. Expert analysis shows that it has become one of the third biggest banks in the United States to collapse since the financial meltdown of 2008.
The ugly scenario of this bank started after the United States government took over the operations of the tech-based lender: Silicon Valley Bank, with over $10 billion in venture capital. The collapse of the world’s biggest financial institutions: Silicon Valley Bank and Signature Bank, has led to the decline in financial stocks in both the United States and the Asian continent.
After the bank was reported to have collapsed, various government authorities moved to salvage the situation to prevent more losses in clients’ deposits. Also, note that regulatory authorities are presently scrutinizing various banks’ top management as investigation into the event intensifies.
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