"Silvergate Bank's Crypto Obsession and Oversight Failures Led to Fatal Collapse, Fed Report Reveals"
Silvergate Bank, a community lender turned crypto bank, was able to take risky actions without raising alarm from its Federal Reserve examiners, leading to its downfall, according to a report from the Federal Reserve's Office of Inspector General (OIG). The OIG found that the bank's change in course should have required a different type of registration, but government supervisors failed to demand it. The report also highlighted issues with the bank's senior management and its ineffective corporate governance and risk management capabilities. The bank voluntarily liquidated, avoiding government intervention, but the OIG made recommendations for improved regulatory oversight in similar situations.
