Silicon Valley Bank Crisis: Justice Department, SEC To Investigate What Happened Behind Closed Doors

The Justice Department and U.S. Securities and Exchange Commission are reportedly investigating Silicon Valley Bank's collapse.

Investigations are in the early stages and do not necessarily imply charges or allegations of misconduct, The Wall Street Journal reported citing sources.

It is common practice for prosecutors and regulators to launch investigations following unforeseen, substantial losses experienced by financial institutions or public companies.

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SVB Financial Group, the former owner of Silicon Valley Bank SIVB, witnessed a 60% drop in its shares last week and has not been trading since Friday.

The investigations are expected to look into stock sales that SVB Financial's executives made a few days before the bank's failure.

The Justice Department's fraud prosecutors in Washington and San Francisco are said to be involved in the investigation.

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Since getting taken over by the FDIC, many pundits have theorized why Silicon Valley Bank folded.

For a look at what went wrong at the Santa Clara, California-based firm, click here.