Tester Leads Letter Calling for Investigation of Silicon Valley Bank Executives’ Stock Sales
Senators to SEC: “The magnitude and timing of stock sales at SVB raise serious questions, and we ask for your prompt examination of these sales”
As part of his continued efforts to hold executives accountable for the failure of Silicon Valley Bank (SVB), U.S. Senator Jon Tester today led a letter to the Securities and Exchange Commission (SEC) calling for an investigation into Bank executives’ stock sales ahead of the collapse.
“We write regarding recent news reports of executives at Silicon Valley Bank (SVB) selling millions of dollars’ worth of company stock in the days and months leading up to SVB’s failure,” wrote the Senators. “Our capital markets are based upon the ironclad trust that corporate insiders act in the best interest of their shareholders, and not in their own self-interest. Addressing breaches of that trust is of paramount importance. The magnitude and timing of stock sales at SVB raise serious questions, and we ask for your prompt examination of these sales.”
In their letter, the Senators specifically sound the alarm over reports that multiple SVB executives collectively sold millions of dollars in stock just days before the Bank collapsed.
“Days before the collapse of the 40 year old bank, the Chief Executive Officer of SVB Financial Group (SVB Group), the holding company of SVB, sold nearly $3.6 million of SVB Group stock. On that same day—February 27—the Chief Financial Officer of SVB Group sold 2,000 shares of company stock at $287.59 per share, netting over $500,000… The timing of the executives’ stock sales in 2023, including the establishment of Rule 10b5-1 trading plans only one month prior to the stock sales that occurred the week before SVB’s demise, is particularly problematic.”
The Senators concluded their letter by calling on the SEC to investigate Bank executives’ stock sales preceding SVB’s collapse: “We believe that given the circumstances of the SVB Group stock sales the SEC must thoroughly review the circumstances of all the recent transactions.”
Tester has led the charge to ensure bank executives and federal regulators are held accountable for the collapse of Silicon Valley Bank. On Wednesday Tester pressed officials on their failure to “drop the hammer” on bank management during a Senate Banking Committee hearing.
Earlier this month, Tester sent a letter to FDIC Chairman Martin J. Gruenberg and Federal Reserve Chairman Jerome H. Powell urging federal financial regulators to hold Silicon Valley Bank executives accountable and use every tool at their disposal to claw back reported bonuses received by the Bank’s leadership. You can read the Senators’ letter HERE.