Deutsche Bank Raided Over Greenwashing Allegations
German authorities raided Deutsche Bank's offices in Frankfurt as part of an investigation into charges that the banking firm misrepresented investment products as "greener" than they were.
Investigators raided the bank's offices and its asset management unit DWS "on suspicion of investment fraud," Frankfurt prosecutors said in a statement.
The searches were related to "greenwashing allegations" at DWS, said Deutsche Bank.
A Deutsche Bank statement read, "DWS will cooperate with all relevant regulators and authorities."
According to the prosecution, the allegations were based on "statements provided by a former DWS employee" who became a whistleblower for US securities regulators in 2021.
In contrast to material in DWS's "sales prospectus," investigators found "sufficient indicators" that ESG (environmental, social, and governance) norms were only taken into account "in a minority of assets."
Prosecutors say the investigation was aimed at "unknown" DWS personnel.
Federal authorities in the United States are already investigating asset management for allegedly lying about the size of its green assets.
As financial institutions aim to align their portfolios with global climate targets, ESG assets have become a prominent asset class.
Last week, US securities regulators proposed tightening disclosure rules for the growing number of ESG investments.
The Securities and Exchange Commission stated the rule was designed to minimise circumstances where a fund "may overstate its real consideration of ESG criteria," to combat "greenwashing."