Deutsche Bank HQ Raided by Police in DWS Greenwashing Probe

Police in Germany have raided Deutsche Bank's offices in Frankfurt as part of an investigation into greenwashing.

Police conducted the raid at the bank's headquarters as well as the nearby offices of its asset management arm, DWS Group. According to Bloomberg, which first reported on the raids, both offices were searched by police as part of greenwashing allegations against DWS.

In a statement to Newsweek, Deutsche Bank said: "The measures taken by the public prosecutor's office are directed against unknown persons in connection with greenwashing allegations made against DWS.

"In response, DWS has stated that it has cooperated continuously and comprehensively with all relevant regulators and authorities in the past and will continue to do so in the future."

Deutsche Bank officers raided
A Deutsche Bank logo is pictured in front of their headquarters on February 2, 2006 in Frankfurt, Germany. Ralph Orlowski//Getty Images

A spokesperson for the public prosecutor's office told Handelsblatt, a German business newspaper, that around 50 officials from the local public prosecutor's office and the Federal Criminal Police Office were involved in the raid.

"The investigations have been running since the beginning of the year and are still aimed at unknown persons," the spokesperson said.

The greenwashing allegations, which DWS denies, involve claims that Deutsche Bank's asset-management arm overstated its environmental, social, and governance (ESG) criteria and how it used sustainable investing criteria to manage investments.

The Justice Department, U.S. Securities and Exchange Commission, and Germany's financial regulator, BaFin, have each launched investigations into the allegations which arose from whistleblower Desiree Fixler.

Fixler, who was fired as the firm's chief sustainability officer in March 2021, alleged DWS misled investors by stating more than half of its assets amounting to hundred of billions of dollars under management were subject to an ESG integration process, meaning that ESG issues were a factor in investment decisions.

As noted by Reuters, there have been concerns over how financial firms define and apply ESG standards as fund managers amass billions of dollars of assets which are meant to have an environmental or social profile.

DWS has since stopped using the label in the wake of the greenwashing investigations.

This is the second time in a matter of weeks that Deutsche Bank's headquarters have been raided.

On April 29, German authorities raided the troubled financial institution's "twin towers" in Frankfurt over allegations of money laundering.

"This is an investigative measure by the Frankfurt public prosecutor's office in connection with suspicious activity reports filed by the bank," the bank said in a statement at the time.

"Deutsche Bank is fully cooperating with the authorities."

Germany's largest lender has also faced scrutiny over its ties with and loans given to former President Donald Trump, as well as its role in the alleged manipulation some years ago of the London interbank offered rate, or Libor.

Update 5/31/22 8:37 a.m. EDT: This article was updated to add further comments and background.