SEC Charges WisdomTree with Misstatements Related to ESG-Marketed Funds

SEC Charges Advisory Firm WisdomTree with Failing to Adhere to Its Own Investment Criteria For ESG-Marketed Funds

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.

Kamala Harris’s Team Is Considering These Candidates to Replace SEC Chair Gary Gensler

The Harris transition team is vetting candidates to replace Gary Gensler as Chair of the Securities Exchange Commission (SEC), according to two sources close to the deliberations.

Unchained has learned of two potential replacements, Georgetown Law professor Chris Brummer and Chair of the Public Company Accounting Oversight Board (PCAOB) Erica Williams, who are said to have more favorable views on crypto than Gensler.

Supreme Court Rejects Bid to Let President Fire Agency Leaders

The US Supreme Court declined to hear an appeal that sought to give the president control over agencies that have long operated independently, potentially including the Federal Trade Commission and Securities and Exchange Commission.

The appeal, pressed by two research organizations in a case involving the Consumer Product Safety Commission, contended that the Constitution gives the president broad power to fire the leaders of executive-branch agencies. It called into question a 1935 Supreme Court precedent that has become a top target for anti-regulatory groups.

Top UK law firms raise hourly rates by 40% in 5 years

The top 10 UK law firms are charging clients almost 40 per cent more per hour than they were five years ago, a survey has found, as inflation and the growth of US firms in London pushed up fees.

The biggest UK-headquartered firms by revenue charged an average of £449 per hour in 2024, compared with £321 in 2019, according to PwC’s annual law firm survey published on Monday, with double-digit growth in average rates across the whole of the top 100 UK firms.

SEC Division of Examinations Announces 2025 Priorities

The Securities and Exchange Commission’s Division of Examinations today released its 2025 examination priorities. The Division publishes its examination priorities annually to inform investors and registrants of potential risks in the U.S. capital markets and to make them aware of the examination topics that the Division plans to focus on in the new fiscal year. This year’s examinations will prioritize perennial and emerging risk areas, such as fiduciary duty, standards of conduct, cybersecurity, and artificial intelligence.

Europe markets watchdog bids to become EU’s version of SEC

The EU’s financial markets watchdog wants expanded powers to oversee major stock exchanges and other critical parts of the bloc’s financial infrastructure, as it bids to become a European version of the US Securities and Exchange Commission.

Verena Ross, chair of the European Securities and Markets Authority, said “there is clearly a political appetite” in the newly appointed European Commission to centralise more EU financial market supervision as part of a renewed push to revive the region’s struggling capital markets.

“Let’s evaluate in which areas it would make sense to move a step further to central EU supervision. We need to look particularly at all the cross-border systemically important infrastructure players,” Ross told the Financial Times, adding this would include exchanges, clearing houses and settlement systems.