As described in this press release, the SEC has filed a complaint against Vale S.A., a publicly traded (NYSE) Brazilian mining company and one of the world's largest iron ore producers, charging that it made "false and misleading claims about the safety of its dams prior to the January 2019 collapse of its Brumadinho dam. The collapse killed 270 people, caused immeasurable environmental and social harm, and led to a loss of more than $4 billion in Vale's market capitalization." The SEC alleged that Vale "fraudulently assured investors that the company adhered to the 'strictest international practices' in evaluating dam safety and that 100 percent of its dams were certified to be in stable condition." Significantly, these statements were contained, not just in Vale's SEC filings, but also, in large part, in its sustainability reports. According to Gurbir Grewal, Director of Enforcement, "[m]any investors rely on ESG disclosures like those contained in Vale's annual Sustainability Reports and other public filings to make informed investment decisions....By allegedly manipulating those disclosures, Vale compounded the social and environmental harm caused by the Brumadinho dam's tragic collapse and undermined investors' ability to evaluate the risks posed by Vale's securities." The SEC's charges arising out of this horrific accident are a version of "event-driven" securities litigation—brought this time, not by shareholders, but by the SEC.
As the SEC alleged in the complaint,...
A popular social media conspiracy theory about a recent cluster of hantavirus cases claims that the word “hanta” means “scam,” “fraud,” or “nonsense” in “Hebrew slang.” That’s more or less where t...