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In full transparency, the following is a media release from Sen. Elizabeth Warren’s office. She was elected by voters in the Commonwealth of Massachusetts to serve the state in Washington DC in the US Senate. She is a Democrat. (stock photo)


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WASHINGTON DC U.S. Senator Elizabeth Warren (D-Mass.) sent a letter to ex-Silicon Valley Bank CEO Greg Becker to inquire about his and SVB lobbyists’ efforts to roll back Dodd-Frank rules prior to the collapse of the bank.

Silicon Valley Bank had 17 locations in California and Massachusetts.

Three years ago today, the Senate passed the Economic Growth, Regulatory Relief, and Consumer Protection Act, rolling back banking regulations enacted by the Dodd-Frank Act and raising the asset threshold at which a bank is considered and regulated as a “systemically important financial institution” (SIFI) to $250 billion. This exempted SVB and other mid-sized banks from regular stress testing and enhanced liquidity, risk management, and resolution plan, or “living will,” requirements. 

“These rules were designed to safeguard our banking system and economy from the negligence of bank executives like yourself – and their rollback, along with atrocious risk management policies at your bank, have been implicated as chief causes of its failure,” wrote Senator Warren

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Becker and SVB executives engaged in intense lobbying to roll back these Dodd-Frank protections. In a 2015 statement submitted to the Senate Committee on Banking, Housing, and Urban Affairs, Becker indicated that “SVB … does not present systemic risks,” and that he had conducted “a range of different stress tests designed to measure and predict the risks associated” with the bank in different economic scenarios.

“Despite your assurances to Congress that SVB was sufficiently protected from risk because of your various efforts, it is now clear that SVB was wholly unequipped to independently assess its business’s risk,” wrote Senator Warren. “SVB failed – while its Chief Risk Officer position sat vacant for eight months as its financial standing deteriorated – because it failed to address two key risks: concentration in your client base, and rising interest rates.”

In the letter, Senator Warren points to Becker’s $3.6 million sale of company stock just days before SVB’s collapse, and bonuses that were paid to SVB employees just before the Federal Deposit Insurance Corporation (FDIC) shut the bank’s doors. 

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“You lobbied for weaker rules, got what you wanted, and used this opportunity to greedily and incompetently abdicate your basic responsibilities to your clients and the public – facilitating a near-economic disaster,” concluded Senator Warren. “There is much work to be done to understand the failure of SVB – and these efforts must start with understanding your role in the rollback of banking regulations that facilitated this failure.”

Senator Warren asked Becker a series of eight questions, asking for answers by March 28, 2023.

Read the text of the letter here.

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By editor

Susan Petroni is the former editor for SOURCE. She is the founder of the former news site, which as of May 1, 2023, is now a self-publishing community bulletin board. The website no longer has a journalist but a webmaster.