Asoka Woehrmann, the chief executive of Deutsche Bank subsidiary DWS, has resigned after German law officials stormed its offices over claims that the company exaggerated the sustainable credentials of some of its financial products.
The raid on the bank's offices followed allegations leveled by a former DWS manager that the retail money management business engaged in 'greenwashing', in which environmental, social and governance (ESG) investments are sold under false claims.
“The allegations are that DWS has been advertising so-called ESG financial products for sale as being particularly green and sustainable when they actually weren't," a spokesman for the public prosecutor told Fortune. "In the course of our investigations we've found evidence that could support allegations of prospectus fraud.”
The former head of sustainability at DWS, Desiree Fixler was pushed out of her job last year after she warned that the company had made misleading statements in its 2020 annual report, in which supposedly more than half the group’s $900 billion in assets under management were invested under ESG criteria.
Woehrmann is being replaced at DWS by Stefan Hoops, who previously had responsibility for the corporate bank.
The probe by German authorities comes just weeks after the US Securities and Exchange Commission fined BNY Mellon $1.5 million for misstatements and omissions about ESG considerations in making investment decisions for certain mutual funds that it managed.