US Justice Department investigators were examining whether the New York bank took sufficient steps to detect potential money laundering by clients.
| US prosecutors were investigating Signature Bank’s work with crypto clients before regulators suddenly seized the lender last weekend, according to people familiar with the matter.
The Securities and Exchange Commission was also taking a look, two people said, asking not to be named.failed bank’s remaining operations Representatives for the Justice Department, US Attorney’s Office in Manhattan and SEC declined to comment. But a spokesperson for the agency, which brings only civil cases, pointed to a statement from chairman Gary Gensler on Sunday , when authorities took steps to bolster US lenders and shut Signature.“We will investigate and bring enforcement actions if we find violations of the federal securities laws,” the SEC chief said at the time.
States’ regulators have said they lost faith in management after the bank failed to provide “reliable and consistent data”.Financial watchdogs and Justice Department officials have repeatedly warned that firms handling crypto or related cash must be vigilant in identifying customers and ensuring money flows are for legitimate purposes. Banks in particular are obliged to flag any suspicious transactions to federal authorities.
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