As federal officials scramble to figure out more details about the sudden failure of Silicon Valley Bank (SVB) last week, some lawmakers in Sacramento are calling for the state to launch its own investigation.
KQED: California Lawmakers Call for State Investigation Into Silicon Valley Bank Failure
KQED: California Lawmakers Call for State Investigation Into Silicon Valley Bank Failure
By Scott Shafer
Assemblymember Timothy Grayson (D-Concord), who heads up his chamber’s Banking and Finance Committee, said that after the federal government releases its report on SVB on May 1, he wants the Legislature to start asking questions.
“We will gather the facts and wait for investigation, reports and analysis to come out. But there will be oversight hearings,” Grayson told KQED this week.
After Republicans succeeded in weakening Dodd-Frank and Trump pushed to undermine the Consumer Financial Protection Bureau, an oversight agency created by his predecessor, California moved to bolster its own consumer banking protections.
In 2020, with a push from Gov. Gavin Newsom, the Legislature passed AB 1864, which created the DFPI, with the goal to “improve accountability and transparency in the California financial system.”
The nascent agency’s powers included the ability to regulate financial institutions, especially state-chartered banks, as well as the authority to enforce consumer protection laws.
Kat Taylor, co-founder and board chair of Beneficial State Bank in Oakland, strongly supported the creation of the agency. She says its regulatory functions are critical because the financial sector is so influential.
“It’s a far bigger industry than any other industry, and it fuels all other industries,” Taylor said, noting that more state and federal oversight of the financial industry is needed. “So we don’t understand it at our peril. And it’s complicated.”
To read the entire article, please visit KQED.