US Appeals Court Revives Signature Bank Collapse Lawsuit
A U.S. appeals court has revived a lawsuit from investors against former executives of collapsed Signature Bank, rejecting the FDIC's claim that it had exclusive authority to pursue securities fraud claims after taking control of the bank in 2023. The case was brought by shareholders led by Sjunde AP-Fonden and accuses seven ex-executives and directors along with auditor KPMG of misrepresenting liquidity risks, inflating share prices. The FDIC had argued a 1989 law gave it sole power in such matters but the court ruled that clause did not strip investors' rights. The decision does not address whether the claims are valid but sends the case back to district court for further proceedings. Signature Bank failed after losing billions of deposits, largely from cryptocurrency clients and other high-risk sectors.
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