United States SEC Fines WisdomTree Asset Management $4 Million for Failure to Apply its Own ESG Criteria for 3 WisdomTree ESG Exchange Traded Funds (ETFs) from 2020 to 2022
22nd October 2024 | Hong Kong
The United States Securities & Exchange Commission (SEC) has fined WisdomTree Asset Management $4 million for failure to apply its own ESG criteria (Environmental, Social & Governance) for 3 WisdomTree ESG exchange traded funds (ETFs) from 2020 to 2022. United States SEC (21/10/24): “The Securities and Exchange Commission today charged New York-based investment adviser WisdomTree Asset Management Inc. with making misstatements and for compliance failures relating to the execution of an investment strategy that was marketed as incorporating environmental, social, and governance (ESG) factors. According to the SEC’s order, from March 2020 until November 2022, WisdomTree represented in prospectuses for three ESG-marketed exchange-traded funds, and to the board of trustees overseeing the funds, that the funds would not invest in companies involved in certain products or activities, including fossil fuels and tobacco. However, the SEC’s order finds that the ESG-marketed funds invested in companies that were involved in fossil fuels and tobacco, including in coal mining and transportation, natural gas extraction and distribution, and retail sales of tobacco products. According to the SEC’s order, WisdomTree used data from third-party vendors that did not screen out all companies involved in fossil fuel and tobacco-related activities. The SEC’s order further finds that WisdomTree did not have any policies and procedures over the screening process to exclude such companies. WisdomTree consented to the entry of the SEC’s order finding that it violated the antifraud provisions of the Investment Advisers Act of 1940 and the Investment Company Act of 1940, and the compliance rule in the Investment Advisers Act. Without admitting or denying the SEC’s findings, WisdomTree agreed to a cease-and-desist order and censure and to pay a $4 million civil penalty.”
“ United States SEC Fines WisdomTree Asset Management $4 Million for Failure to Apply its Own ESG Criteria for 3 WisdomTree ESG Exchange Traded Funds (ETFs) from 2020 to 2022 “
United States SEC Fines WisdomTree Asset Management $4 Million for Failure to Apply its Own ESG Criteria for 3 WisdomTree ESG Exchange Traded Funds (ETFs) from 2020 to 2022
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