Germany: Deutsche Bank suspect of "greenwashing", Searches underway

German justice raided Tuesday the Frankfurt offices of Deutsche Bank and its subsidiary DWS fund management in Frankfurt as part of an investigation into "fraud" regarding investments that were sold as more "green" and "sustainable" than they really are.

Germany: Deutsche Bank suspect of "greenwashing", Searches underway

German justice raided Tuesday the Frankfurt offices of Deutsche Bank and its subsidiary DWS fund management in Frankfurt as part of an investigation into "fraud" regarding investments that were sold as more "green" and "sustainable" than they really are. The city prosecutor's office stated that they were "in reality".

According to a spokesperson for Deutsche Bank, the searches are "in connection with the greenwashing" charges against DWS, Europe’s second-largest asset manger, who "has indicated in past that it cooperates with authorities." .

The prosecution explains that the justice "found clues" during its investigation. "Contrary to the descriptions in DWS' sustainable fund prospectuses, ESG criteria (environmental and social governance criteria, editor’s note) were not taken into consideration for only a small number of investments and weren't considered for a large amount of financial investments.

ESG-labeled investments are now a major asset class, as global warming becomes a social problem.

According to a press release, the German procedure was initiated after news reports and statements made by a whistleblower. Desiree Fixler (ex-head of sustainable development at DWS), alerted the authorities, accusing the company of inflating the size of investments that met ESG criteria.

An investigation by the US Federal Police is underway.

Many countries are launching initiatives to fight "greenwashing" or greenwashing. Companies' exaggerated and even misleading promotion of global warming initiatives. The American stock market watchdog SEC announced last week a new initiative to increase transparency obligations for financial advisors and asset managers.

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