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Dear John,
Some guys just have good timing.
Was it just a coincidence that Silicon Valley Bank CEO Greg Becker made off with $3.6 million from sales of his stock just days before his bank went under? Or that he had sold shares worth nearly $30 million over the previous two years?
Did he know something we didn’t? CFO Daniel Beck and other top executives at Silicon Valley Bank also cashed in big on their stocks in the days leading up to the collapse of their bank. Just luck perhaps?
Or is it possible that, after lobbying for years to successfully gut Dodd-Frank’s crucial legislative safeguards against failure of mid-sized banks, these execs knew perfectly well how soon their stock shares were going to tank.
Separate investigations by the Securities & Exchange Commission and the Department of Justice are a good start, but we need to hear Greg Becker and other top executives explain their actions -- under oath and for the public -- in front of Congress now.
The restrictions that Becker lobbied so hard against included stress-testing of midsize banks and increasing the minimum cash banks were required to keep on hand. These protections were set in place by Dodd-Frank, passed in 2008 in the wake of the economic collapse that resulted in 8.7 million Americans losing their jobs, 10 million people losing their homes, and a drop in total U.S. household net worth of $11.1 trillion.
Proving their political power yet again, during the Trump administration Wall Street CEOs got Congress to gut these protections, making it almost inevitable for this totally avoidable crisis to happen.
Now, some leaders in Congress aren’t just calling to restore those protections, they’re demanding accountability for and answers from SVB executives.
Senator Elizabeth Warren is demanding answers. Taking the fight directly to Becker in an open letter to him last week, she wants Becker to describe for the public exactly how much time, money, and resources he spent in his crusade to water down the Dodd-Frank reforms.
She wants him to explain his role in the rollback of banking regulations that facilitated this failure.
Congress needs to turn up the heat and require Becker and Beck and other SVB executives testify in public and under oath about their lobbying efforts, exorbitant compensation, and suspiciously timed stock sales. Please sign and send your message to Congress now.
Thank you for doing your part to hold accountable those who seek to destabilize our entire financial system for their own and shareholders’ short term profits.
Robert Reich
Inequality Media Civic Action
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