The Frankfurt workplaces of
Deutsche Bank AG
DB -0.62%
and its asset-management subsidiary DWS Group have been raided by authorities on Tuesday over allegations of greenwashing in its mutual funds, including to strain on the lender which is already going through a U.S. probe.
Around 50 brokers of town’s public prosecutor’s workplace, alongside German market regulator BaFin and the federal legal police workplace had been deployed Tuesday morning, a spokeswoman for Frankfurt prosecutor’s workplace mentioned.
The preliminary suspicion is of funding fraud, the spokeswoman mentioned.
The motion Tuesday provides to probes by the Securities and Exchange Commission and federal prosecutors within the U.S. into the asset supervisor’s claims of sustainable investing. The Wall Street Journal reported final yr that DWS was being investigated for disclosures round funds that say they use environmental, social or governance, or ESG elements to decide on investments. The investigation began after the agency’s former head of sustainability mentioned claims concerning the funds have been overstated.
Regulators have been stepping up scrutiny of such funds as traders pour money into the class. Last week, the SEC fined Bank of New York Mellon Corp. $1.5 million for deceptive claims about ESG funds. Within the business, requirements and measurements of ESG advantages are nonetheless evolving, making it tough for traders to understand how their funds are investing.
Deutsche Bank confirmed the searches. “The measures of the public prosecutors are directed against unknown people in connection with greenwashing allegations against DWS,” a spokesman for the German lender mentioned.
Deutsche shares have been down 1.7% on the information.
A DWS spokesperson mentioned: “We have continuously cooperated fully with all relevant regulators and authorities on this matter and will continue to do so.”
Deutsche Bank was final searched by German authorities in late April, which the lender mentioned was associated to exercise stories it filed to an anti-money-laundering company.
Write to Matthias Goldschmidt at [email protected]
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Source: www.wsj.com”