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Prior to its collapse, Signature Bank under criminal investigation

When regulators abruptly seized the lender last weekend, U.S. prosecutors were looking into Signature Bank’s connections to cryptocurrency clients, according to Bloomberg News on Tuesday, which cited people familiar with the situation.

According to the article, U.S. Justice Department investigators in Washington and Manhattan were looking into whether the now-defunct bank took the required precautions to uncover suspected money laundering by its clients. The Securities and Exchange Commission (SEC) was also looking into the bank.

The news comes shortly after the New York financial regulator claimed earlier in the day that the closure of Signature Bank was not related to cryptocurrencies and was instead prompted by what it called “a significant crisis of confidence in the bank’s leadership” following Silicon Valley Bank’s failure.

The lender is now under the supervision of the United States Federal Deposit Insurance Corporation, which declined to comment on the report. A request for comments from Reuters was not immediately answered by the SEC, Justice Department, or Signature Bank.

Two days after authorities dissolved Silicon Valley Bank (SVB) in a collapse that left billions in savings unclaimed, state regulators shut down New York-based Signature Bank on Sunday, marking the third-largest failure in American banking history.

Almost a quarter of Signature Bank’s deposits as of September 2017 come from the cryptocurrency industry, but the bank declared in December 2017 that it will reduce those deposits by $8 billion.

Patrick Huston
Patrick Huston
As a senior editor, Patrick is a professional who is in charge of putting out business news. As a senior editor, Patrick is likely to be in charge of the duties of junior editors and writers, make sure the content is correct and high-quality, and work with other departments to make sure the business news is published on time. Patrick knows a lot about business and the latest market trends. He uses this knowledge to choose and edit stories that are both interesting and useful to readers. He also works with reporters and analysts to come up with insightful pieces that help readers keep up with the latest business news. Patrick is a very important part of keeping the public informed and interested in important business issues. He is passionate about journalism and strives for excellence.

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