A class action lawsuit involving Silvergate Bank has been filed in US courts, alleging it played a major role in Sam Bankman-Fried's FTX and Alameda Research scam. On Dec. 14, a class action lawsuit was filed in the Southern District of California against Silvergate Bank, Silvergate Capital Corporation, and Silvergate CEO Alan Lane, involving accounts held by cryptocurrency firms FTX and Alameda Research.
Joewy Gonzalez and others have accused Silvergate Bank of playing an integral role in the FTX scam by maintaining accounts, while supporting and abetting the collapse of FTX and the breach of fiduciary duty by Alameda Research. According to the lawsuit, the plaintiffs invested their savings in cryptocurrencies through the FTX exchange because the platform promised investors that they could "safely store assets, withdraw cash, or exchange them for other assets as they grow in value."
Previously, on Dec. 6, three U.S. senators sent a letter to Silvergate seeking answers about the firm’s role in the multibillion-dollar losses caused by the FTX crash. Senators Elizabeth Warren, John F. Kennedy and Roger Marshall asked Lane for details of the company's relationship with FTX.
Shares of Silvergate Capital (SI -1.95%) have fallen sharply over the past five sessions, as they did last week, on the back of negative news about their complicated relationship with FTX. Shares of the bank, which has a heavy cryptocurrency habit, are down more than 13% in the period, compounding a 19% drop the previous week, according to data compiled by S&P Global Market Intelligence.
