Silicon Valley Bank's ex-CEO and CFO are now facing a class-action lawsuit due to the commercial bank's downfall.
This legal action is the first over the demise of SVB is the first one. Critics expect that more lawsuits will be filed against SVB officials since the bank's failure puts consumers' money at risk.
On Monday, Mar. 13, the proposed class-action lawsuit was filed in the federal court in San Jose, California.
Silicon Valley Bank CEO, CFO Face Class-Action Lawsuit
According to The Guardian's latest report, the class-action lawsuit against ex-SVB CEO Greg Becker and SVB CFO Daniel Beck claims the bank failed to disclose the effects of the inflation rate in its business.
Shareholders who filed the lawsuit were led by Chandra Vanipenta. They complained that SVP left its business worse off than other commercial banks with different client bases.
As of writing, the class-action lawsuit demands unspecified damages for the bank's investors between June 16, 2021, and Mar. 10.
The Silicon Valley Bank said that it will find alternative strategies for what remains of the financial firm.
New SVB CEO Says Company is Business as Usual
On Mar. 13, the U.S. Federal Deposit Insurance Corporation (FDIC) decided to appoint Tim Mayopoulos, Fannie Mae's head, as the new SVB CEO.
Before Mayopoulos took over the financial company, regulators took control of the SVB; naming it Silicon Valley Bank N.A.
This newly created bridge bank has all the deposits of SVB, allowing all depositors to have access to their money, as reported by Reuters.
When Tim officially became the new CEO, he said that the SVB N.A. is conducting business as usual. This means that the lender is open to clients.
"I look forward to getting to know the clients of Silicon Valley Bank...I also come to this role with experience in these kinds of situations," said Mayopoulos.
If you want to learn more details about the new SVB CEO, you can click this link.
In other news, the SVB collapse affected numerous Indian startups. We also reported about the interest of Elon Musk in acquiring the Silicon Valley Bank.
For more news updates about SVB and other fin-tech topics, always keep your tabs open here at TechTimes.
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