Silvergate Capital Corporation (SI)

Investigation 

Bronstein, Gewirtz & Grossman, LLC is investigating potential claims against Silvergate Capital Corporation (“Silvergate” or the “Company”) (NYSE: SI). Investors who purchased Silvergate securities are encouraged to obtain additional information and assist the investigation.

 

The investigation concerns whether Silvergate violated federal securities laws.

 

On November 15, 2022, market analysts reported that Silvergate’s exposure to FTX, a cryptocurrency exchange currently experiencing a significant liquidity crisis, could be far greater than the Company had previously represented.  Specifically, market analysts suggested that FTX deposits constitute a sizable portion of Silvergate’s deposit base and that this is a significant red flag.  On this news, Silvergate’s stock price fell $6.13 per share, or 17.27%, to close at $29.36 per share on November 15, 2022.  Then, on November 17, 2022, research analyst The Bear Cave published a report entitled “The Great Crypto Collapse,” which addressed the exposure of Silvergate and other banks to the recent cryptocurrency collapse.  Among other items, the report notes that Silvergate is mentioned in a forfeiture application connected to a money laundering operation, which include allegations—supported by documents purportedly produced by Silvergate—that “(i) During the period of September 2021 to June 2022 ten companies had transferred a total of over $425 million dollars off these cryptocurrency trading platforms into accounts held at different US banks, [and] (ii) The accounts were receiving funds in the same pattern as those . . . used to facilitate the laundering of illicit funds.”  On this news, Silvergate’s stock price fell $3.44 per share, or 10.98%, to close at $27.90 per share on November 17, 2022.

On November 20, 2022, The Wall Street Journal published a report, “Crypto Bank Silvergate Battles FTX Contagion Fears: The collapse of Sam Bankman-Fried’s empire has sparked investor fears about banks that courted crypto companies” which stated “[o]n Friday, crypto-trading platform FalconX told its customers it was no longer using Silvergate. FalconX said the elevated risk in the crypto market required extra caution and told customers its decision was ‘consistent with other market players.”

 

If you are aware of any facts relating to this investigation or purchased Silvergate securities, you can assist this investigation. You can also contact Peretz Bronstein or his Law Clerk and Client Relations Manager, Yael Nathanson of Bronstein, Gewirtz & Grossman, LLC: 212-697-6484. 

Bronstein, Gewirtz & Grossman, LLC represents investors in securities fraud class actions and shareholder derivative suits.  The firm has recovered hundreds of millions of dollars for investors nationwide.  Attorney advertising. Prior results do not guarantee similar outcomes.