WASHINGTON, D.C.— Dennis Kelleher, President, CEO and Co-founder of Better Markets, issued the following statement in connection with the Federal Deposit Insurance Corporation (FDIC) authorizing lawsuits against six former officers and eleven former directors of Silicon Valley Bank (SVB).

“We applaud the FDIC for acting to hold SVB’s officers and directors accountable for their alleged mismanagement and reckless, irresponsible, and unlawful conduct that led to the banks’ failure and ignited a banking crisis. The needless and avoidable collapse of SVB precipitated a banking crisis, led to a $23 billion loss to the deposit insurance fund and cost Americans as much as 1% of lost GDP due to the contagion and resulting credit contraction.

“Banks don’t neglect their duties, act recklessly, engage in high-risk behavior, or break the law – bankers do and that will continue unless and until individual bankers are meaningfully and personally punished. The lack of accountability for officers and directors of the biggest banks is a national disgrace that undermines the rule of law, and the faith and trust Americans have in their government and the banking system. It also creates moral hazard where bankers are incentivized to engage in inappropriate high-risk activities in the hope of pocketing unimaginable riches knowing that they will suffer no consequences for their behavior when their bets blow up.

“Suing SVB’s officers and directors for their alleged failings and the failure of the bank is an important first step in bringing accountability back to the banking industry.  However, it must not stop there. Bankers, especially at the biggest, most dangerous banks, simply have to believe that there will be meaningful consequences for their misconduct if they are ever to be deterred from engaging in that conduct in the first place. Hopefully, this trial process will be as transparent as possible so that bankers will think about what their actions look like when subjected to public scrutiny and so that the American people can see that bankers are not above the law.”