Insiders at the recently collapsed Signature Bank reportedly sold more than $100M in stock in recent years, according to the Wall Street Journal (WSJ).
A WSJ analysis found that sales by the bank’s chairman, its former
chief executive officer, and his successor made up about half of insider
stock sales during the last three years.
- Signature Chairman Scott Shay sold $5.4M worth of stock in 2021 and $644,000 in 2023.
- He also bought ~$1.5M in Signature stock since 2020.
- In 2021, CEO Joseph DePaolo sold $13.9M in stock, and chief operating officer Eric Howell sold $14.9M in stock.
- Signature
was one of only two companies in the S&P 500 that didn't file
insider-trading transactions with the Securities and Exchange Commission
(SEC), instead choosing to file with the Federal Deposit Insurance
Corporation (FDIC).
- As a result, the Signature executives'
transactions were not tracked on websites commonly used by investors to
analyze stock sales or purchases made by the executives of public
companies.
- The three executives served on the Signature board committee for risk management and were vocal advocates of the bank's pivot into the cryptocurrency industry.
- On March 14, Signature shareholders filed a class action lawsuit against Signature, DePaolo, Howell, and Signature chief financial officer Stephen Wyremski for alleged fraud.
- Last
month, Martin Gruenberg, chairman of the FDIC board of directors, told a
Senate committee that his agency was investigating whether Signature's
directors and officers were involved in mismanagement, which could lead
to fines or professional bans.
