Silicon Valley Bank’s CEO should return millions in company stock he sold, lawmakers say


The list of companies and banks potentially affected by Friday’s collapse of Silicon Valley Bank is growing. But at least one person appears to have cashed in recently: CEO Greg Becker, whose trust sold $3.6 million worth of stock on Feb. 27, according to SEC filings. .

Becker is now under scrutiny, among other things from a personal acquaintance, the Democratic California Rep. Ro Khanna, who said Sunday that Becker should return the money.

“There should be a clawback of any of that money,” Khanna said in an interview with The Washington Post. “It should go to the depositors.”

The sharp comments from Khanna, who represents the district where Silicon Valley Bank was headquartered, come amid furor in Washington over what the government’s role should be in rescuing the bank and making its customers whole.

Bailout talk shakes Washington after Silicon Valley Bank collapse

Representatives for Silicon Valley Bank did not immediately return a request for comment.

Khanna offered a caveat, saying the sale may not indicate wrongdoing. “It’s important to understand before casting doubt on someone’s motives whether it’s a planned sale … done many months before,” he said. “We need all the facts to come out before we can draw any conclusions.”

Federal regulators have been working over the weekend on plans to help customers affected by the bank’s collapse, but have ruled out a bailout, according to Treasury Secretary Janet L. Yellen, who spoke on CBS’s “Face the Nation” on Sunday.

Shortly after the bank disclosed a $1.8 billion loss to shareholders that sparked a run, the Federal Deposit Insurance Corporation closed it Friday and took control of its deposits. Customer deposits of up to $250,000 are insured and customers will have access to those funds on Monday morning, the regulator said.

But that coverage does not apply to the more than 90 percent of the bank’s customers – including titans from the technology industry – who have deposits above that limit.

The burning question for many now is whether an outside firm will buy Silicon Valley Bank and make customers whole, or whether the US government will step in and insure customer deposits above $250,000.

Without a buyer, Congress would likely have to pass legislation to draw on an insurance fund paid into by all banks and supported by American taxpayers.

Critics warn that any government support could set a worrisome precedent, leading other banks to expect federal authorities to step in if they fail. It could also trigger a populist backlash over the appearance of US taxpayer money to bail out some of the country’s wealthiest residents.

For his part, Khanna said the federal government should make Silicon Valley Bank customers whole. Many of its clients, who range from companies that provide payroll to vineyards to climate start-ups, have done nothing wrong, he said earlier in the day in comments on “Face the Nation.”

“They didn’t take risks,” he said. “They just had their money in a bank. And we say they must be guaranteed.”

Rep. Nancy Mace (RS.C.) was among those on the other side, signaling her opposition to a bailout in comments on CNN’s “State of the Union” on Sunday.

“We can’t keep bailing out private companies because there are no consequences for their actions,” she said. “People when they make mistakes or break the law must be held accountable in this country.”

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