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Authorities in the United States are currently investigating DWS Group after a former executive said the firm overstated its sustainable investment criteria.
SEC And Federal Prosecutors Are Investigating DWS Group
Deutsche Bank AG’s asset-management arm, DWS Group, is currently under investigation by authorities in the United States. According to a report by the Wall Street Journal earlier today, the investigation comes after DWS’s former head of sustainability said the asset management firm overstated how much it used sustainable investing criteria to manage its assets.
The United States Securities and Exchange Commission and federal prosecutors are currently in the early stages of investigating the investment firm. DWS, with over $1 trillion in assets under management, overstated its sustainable investing efforts.
According to the Wall Street Journal, DWS Group struggled with its social, governance and environmental investing strategies. However, the firm sometimes painted a rosier picture, telling investors that its strategies in those areas were excellent.
When contacted via email, a spokesperson for DWS Group said the company doesn’t comment on regulatory matters. The Wall Street Journal also contacted the parent company Deutsche Bank, but it also declined to comment on the issue. Furthermore, the SEC also didn’t comment on the matter when it was contacted.
Deutsche Bank owns a majority of DWS, and it is a German financial giant. In recent years, Deutsche Bank reached agreements with numerous regulators for some shady acts of business.
DWS’s Stock Price Plummets
The news of the probe by United States authorities has sent the stock price of DWS into a free fall. DWS, which trades on the Frankfurt Stock Exchange, has seen its stock price drop by over 13% in the past 24 hours.
At the time of writing, DWS’s stock price is trading at EUR 36.28. Year-to-date, the asset management firm has performed well, with its stock price up by 10% since the beginning of the year.
This article was originally posted on FX Empire