Cryptocurrency-friendly banking institution Silvergate Capital Corporation has reached a $63 million settlement in the US.

The U.S. Securities and Exchange Commission (SEC) filed a lawsuit against the defunct Silvergate on Monday.

Allegation of making false statements

SEC alleged that Silvergate misled investors in the opposite direction despite not sufficiently complying with Bank Secrecy Act and anti-money laundering laws.

SEC has filed a lawsuit against the affiliated company of Silvergate Bank and its former CEO Alan Lane, former COO Katleen Fraher, and former CFO Antonio Martino. While Lane and Fraher did not admit the SEC's allegations, Silvergate reached a settlement.

Lane and Fraher also accepted the penalty of not serving as executives in a public company for the next five years.

Similarly, the Fed and California officials also filed a lawsuit against the bank on the grounds that it did not inform the public about certain issues. Silvergate has also reached an agreement with the Fed and DFPI.

Will pay 63 million dollars

Silvergate received a fine of $43 million from the Fed; $20 million from California, totaling $63 million. In addition, the SEC imposed a fine of $50 million, but it is not included in the total amount. The settlement reached between the parties still needs to be approved by the court.

According to the SEC's claim, Silvergate also failed to detect the suspicious transaction worth $9 billion on FTX, one of its largest customers. The cryptocurrency exchange FTX went bankrupt in November 2022.

Silvergate, which serves many cryptocurrency companies, voluntarily decided to liquidate last year. Unlike the cases of Silicon Valley Bank and Signature Bank, Silvergate's liquidation process did not require government intervention.