New Lawsuit Claims Silvergate Bank Aided And Abetted SBF And FTX Fraud

A newly proposed class-action lawsuit accuses Silvergate Bank and its CEO Alan Lane of assisting in a “multibillion-dollar fraudulent scheme orchestrated by Sam Bankman-Fried (SBF)” and his entities FTX and Alameda Research. 

Source: https://www.courtlistener.com/docket/66813713/1/bhatia-v-silvergate-bank/

The lawsuit, filed on February 14 in the US District Court for the Northern District of California, was brought on behalf of an FTX user based in San Francisco who claims to have lost around $20,000 in cryptocurrency when the exchange collapsed last year.

The plaintiff, Soham Bhatia, alleges that Silvergate Bank, its parent company Silvergate Capital Corporation, and CEO Alan Lane were aware of the use of FTX customer funds by Alameda Research, and that they concealed “the true nature of FTX” from their customers.

In a proposed class-action lawsuit filed in the US District Court for the Northern District of California, Silvergate Bank and its CEO Alan Lane are accused of aiding, abetting, encouraging, and substantially assisting Sam Bankman-Fried in a fraudulent scheme against the plaintiff and the proposed class.

The lawsuit seeks damages, restitution, and disgorgement of profits, but it has not yet been certified by the district court for class action.

Source: https://www.courtlistener.com/docket/66813713/1/bhatia-v-silvergate-bank/

This is the latest in a series of class-action complaints against Silvergate over the last two months, including a similar lawsuit filed in December 2022 and another filed in January 2023, which alleges that Silvergate failed to detect money laundering activities. Other companies, such as Signature Bank, have also been accused of facilitating the FTX fraud.