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How can they claw back withdrawals?
by pishpash 4y ago
How can they claw back withdrawals?
- digitaltrees 4y agoThe bankruptcy code provides guidance for a 90 day look back period from the date of insolvency where transactions can be clawed back or must be repaid. The FDIC will talk to the recipient bank and get a court order to deposit the funds in to a trustee account so that all available assets can be distributed evenly and fairly.
- twblalock 4y agoThey are very unlikely to do that to normal individual account holders. It would undermine the purpose of providing the deposit insurance in the first place.
- deleted 4y ago[deleted]
- digitaltrees 4y agoI would bet many accounts had balances well over the $250k cap and had larger withdrawals that, if left completed, would reward the first movers in the run on SVB to benefit to a greater extent than account holders that waited. I agree that people below the threshold won’t see claw backs.
- tome 4y agoIf this happens then those who took their money out not only caused the bank run but didn't benefit having taken it out anyway!
- BeFlatXIII 4y agoThat's probably the exact reason for the clawbacks.