- Scott Shay and Greg Becker criticized for their congressional testimony
- The two executives were careful to shift the blame for the bank collapses onto “alarmists” and regulators
- Both received hefty bonuses shortly before the organizations collapsed
The U.S. Congressional Banking Committee held a hearing Tuesday, May 16 on the collapse of SVB and Signature Bank.
At the meeting members of the former management of the organizations spoke, who were very reluctant to take responsibility for what happened.
For example, in his testimony former Signature executive Scott Shay tried to shift the blame for the collapse of the organization on the cryptocurrency sector and regulators.
Allegedly after SVB’s bankruptcy, depositors withdrew about $16 billion, leading to a hole in the bank’s budget.
“In your testimony, you seem to blame customers and regulators, yet you do not consider yourself guilty” – Senator Cynthia Lummis.
Shay denied the statement, but was caught in a double-speak. The term “cryptocurrency” is mentioned 10 times in the former bank CEO’s brief speech.
Elizabeth Warren was not left out either. She stated that Shay and Greg Becker (ex-head of SVB) “got millions” while their banks were collapsing. Senator Sherrod Brown agreed with her:
“You received the bonuses just hours before the asset freeze by federal agencies. Unfortunately, this is a common practice on Wall Street.
While ordinary Americans are losing money, executives are running off into the sunset.”
And this is indeed true. Earlier we reported that Greg Becker fled to Hawaii instead of directing the liquidation of SVB and speeding up compensation payments.
The Committee’s position is quite clear – the cause of the collapse of the two banks lies in management miscalculations.
They did not consider the risks and ignored the recommendations of the federal authorities, which caused the collapse.