Silicon Valley Bank (SVB) is facing its first securities fraud lawsuit, with potentially more to follow, from shareholders who claim that the bank failed to warn them about risks to its business model. The class-action lawsuit was filed on behalf of shareholder Chandra Vanipenta, who alleges that SVB’s CEO Greg Becker and CFO Daniel Beck made false statements that led to artificially inflated share prices.
According to the complaint filed in federal court in San Jose, California, SVB Financial Group, the bank’s parent company, failed to disclose the risk that interest rate hikes posed to the bank in multiple quarterly reports over the last two years. As a result, Vanipenta argues that he and other shareholders were misled into purchasing SVB shares at inflated prices.