Xtrackers Parent DWS Visited by German Police, Prosecutors

U.S. and German regulators have been investigating greenwashing allegations at the company since 2021.

DWS, which issues the Xtrackers line of exchange-traded funds in the U.S., was visited by German prosecutors for the second time in two weeks on Thursday as part of an ongoing investigation into greenwashing allegations.

Regulators in the U.S. and Germany have been investigating the German asset manager since 2021 after a whistleblower said the group may have been overstating the green credentials of their funds. In the U.S., Xtrackers manages $20.2 billion in 45 ETFs, including its largest, the $4.87 billion Xtrackers MSCI EAFE Hedged Equity ETF (DBEF).

The operation—involving three prosecutors and a team of 30 police officers—took place shortly after the group announced its full year results.

 A a spokesperson said DWS is cooperating with the investigation.

“Shortly after announcing our results for the past financial year this morning, we learned that the Frankfurt public prosecutor's office once again is visiting our premises,” a DWS spokesperson said.

“As previously, we will continue to cooperate fully with the authorities in order to come to a resolution of this investigation as quickly as possible.”

DWS, Xtrackers Previous Fine

It comes after a similar visit by prosecutors on Jan. 16, also at the asset manager's headquarters in Frankfurt.

The raids sit against the backdrop of a $19 million fine levied by the Securities and Exchange Commission last September to settle the historic greenwashing probe.

The SEC charged the German asset manager in September for misstatements linked to its sustainable investments, allegations brought by former employee Desirée Fixler.

The penalty, which is the largest ever handed down by the SEC for an ESG offense, will rise to $25 million after the firm was accused of anti-money laundering violations in a separate probe.

The allegations started in 2021, and DWS’s offices were first searched in May 2022, with former CEO Asoka Woehrmann stepping down shortly after.