🧵1/Ω A few things about @CrossRiverBank, a tiny #a16z funded lender that originated more #PPP loans for "small businesses" than anyone besides Chase, BofA, and Wells Fargo, mostly for people who were not their customers.
🧵2/Ω They paid @McKinsey a bunch of money to tell the world that "while most banks originated PPP loans to their own customers, Cross River leads in originations to new customers" mckinsey.com/industries/fin…
🧵3/Ω Unlike other banks that blew up on "fund banking" recently (*cough* $SBNY $SIVB *cough*) @CrossRiverBank does their "fund banking" differently:
They package all the loans and sell them to weird "fintech" companies like @Upstart. @mikulaja
🧵4/Ω
100,000 #PPP / covid relief loans, mostly to new customers, processed by a super tiny bank @CrossRiverBank
Basically claiming to have the most incredibly skilled and fastest fraud prevention team at any bank on the planet by orders of magnitude 🚩 nytimes.com/2020/06/23/bus…
🧵5/Ω
Much like criminal mastermind Alan Lane (CEO of $SI) and noted theologian #ScottShay (president of $SBNY), the CEO is deeply religious (and wants you to know it).
🧵9/Ω
$SRAX also was just apparently de-listed from the @Nasdaq for failure to comply with filing requirements last week. 🚩 sec.gov/ix?doc=/Archiv…
🧵10/Ω @CrossRiverBank is also now the main banking partner for @Circle of recently de-pegged stablecoin $USDC fame now that their other banks have all blown up.
🧵12/Ω
So the story of @CrossRiverBank has a lot of drama. It's got #BrockPierce for the pedo connection, #Tether for some Putin, what appears to be massive #PPP / covid relief fraud for the $ part...
Why not sprinkle in a little Ukraine for good measure?
🧵14/Ω
If you wonder why a tiny bank like @CrossRiverBank might shovel fraudulent #PPP / covid relief loans out, maybe it's because they collected ~$233 million in fees according to NYT
ps the fact that NYT took this at face value is one of many reasons it's a national disgrace.
🧵15/Ω #CrossRiverBank has biz lines other than crypto. e.g. in 2022 they loaned $105mm to a luxury condo by shady developers #Bushburg and #Moinian deep in the lowest income neighborhood in all of NYC.
"deal makes no sense" - NY RE reporters.
if economy turns loan will fail.
🧵16/Ω
CrossRiver is also one of the only banks besides @SilvergateBank / $SI (R.I.P.) to make loans and take crypto as collateral.
They also marketed $WAVES / $USDN, a now collapsed fraud, to customers.
🧵17/Ω @AmerBanker: A bank originating #PPP loan fraud, doing fraudulent round robin lending with $UPST, banking crypto, and lending out actual $ for crypto collateral is "best place to work" 5 yrs in a row.
Remind you of an "innovative" energy company?
"Let us build."
🧵18/Ω
So what does the @coinbase / Cross River relationship look like? Well.
Apparently the company that shoveled out fraudulent #PPP loans is in the "compliance" business.
Does @CrossRiverBank still do compliance for $COIN? Because if so lol.
🧵19/Ω
By number of #PPP loans @CrossRiverBank was #4 in the country. But by dollar figure?
🥈 2nd 🥈
As an aside this brochure seems to be marketed at "woke" which is interesting bc their Haredi employees are among the least "woke" people on the planet crossriver.com/sites/default/…
🧵20/Ω
Apparently @KabbageInc (R.I.P.) did some actual customer facing work w/r/t the enormous number of fraudulent loan applications @CrossRiverBank processed.
#Kabbage got bought by #AmEx but is now under federal investigation & bankrupt
🧵24/Ω
Perhaps now is a good time to mention that a recent study found that 5-14% of all emergency covid #PPP relief funds ended up being "invested" in crypto, particularly among the less educated.
🧵25/Ω
Perhaps now is a good time to mention that a recent study found that 5-14% of all emergency covid #PPP relief funds ended up being "invested" in crypto, particularly among the less educated.
🧵29/Ω
tfw you wasted time researching & screenshooting examples that @CrossRiverBank's #PPP covid lending was sus af to tweet when you could have just checked the nj biz news and found out #CrossRiverBank is currently under investigation for money crimes. njbiz.com/cross-river-ba…
@crossriverbank 🧵30/Ω
So @Coinbase / @Circle / $USDC's bank is under investigation for money crimes (probably because it committed money crimes).
🧵31/Ω
"@CrossRiverBank's less hands-on approach ... may have led it to approve riskier loans... U. of Texas graph shows ~20%¹ of CRB's loans had at least 1 suspicious indicator."
🧵32/Ω
😱WOW😱 missed this part about @CrossRiverBank: The US Government owes Cross River $300 million (⁉️) in loan forgiveness... that it's not willing to forgive.
No wonder so many CRB #PPP loans' status is "Not Disclosed" instead of "forgiven": they have a $300m hole.
🧵33/Ω
I did a whole other thread about the Congressional report on how fintechs (including @CrossRiverBank) had facilitated fraudulent #PPP / covid relief loans and are now under investigation.
🧵35/Ω
One thing that's weird here is that some of these job listings come up as being for something called #CrossTheRiver but logo and address are #CrossRiverBank.
The first time it comes out on the floor of the Congress that we just bailed out a bunch of Chinese tech millionaires with links to the PRC at American citizens' expense...
💥💥~ 1:33:40💥💥
It gets even better when @SecYellen says that there will be no bailouts for anyone who holds more than $250,000 in a rural bank in Oklahoma that collapses [due to the Fed raising rates so quickly].
Trust me when I say you're gonna hear a lot about this for the next forever.
Without even commenting on right vs. wrong, I can just tell you this is the 2024 campaign:
Dems: "YOU ROLLED BACK REGULATIONS!"
Repubs: "YOU BAILED OUT COMMUNIST CHINAMEN!"
ad infinitum.
Here are some very wise words from the very wise wizard Chanos 👇
🧵1/Ω
Let's talk about Metropolitan Community Bank (@MCBankNY, $MCB) one of the remaining publicly traded "crypto-friendly banks. Because the SEC filings look a lot like a mini-me version of our friend $SBNY.
Cash position down 90% YoY 👇
🧵2/Ω
$MCB has $2.2 billion - 42%! - in uninsured, non-interest bearing accounts.
In other words someone is willing to set $132 million a year on 🔥 because of inflation just to hold money in $MCB.
Why?
(note that $SIVB and $SBNY also had large non-interest bearing accounts)
🧵3/Ω
$MCB also of course has large unrecognized losses due to the "duration mismatch" problem that rekt $SI and $SIVB ¹.
They backed the most of NYC's worst landlords. And let me tell you it is an achievement to get on the worst landlord watchlist. These are landlords who are collecting rent while racking up hundreds or even thousands of violations.
2/🧵
They also were a big player in the NY taxi medallion racket by which enormous numbers of hard working immigrants who thought they had achieved financial freedom by taking out a mortgage to buy a tax medallion were ruined.
3/🧵
And now it looks like they may have been cooking the books the whole time.
folks who still believe the noise about $SIVB just being duration mismatch: have you considered this?
get depositor money →
lend VC cash →
VC funds co. →
VC requires co. keep deposits at $SIVB →
voila! yr loan is now a deposit in yr bank
...which you can lend out again
look at the $SIVB balance sheet anon. here I'll make it easy for you:
🧵 When $60 billion in Ponzi scheme loans to tech bros & crypto crooks go bad (and we'll know how bad once the auction prices come out) who foots the bill anon?
Every American with a bank account will. Maybe not in taxes, but in bank charges. #VentureSocialism