Blackrock Ordered To Cease And Desist Over Fraud Accusation

The Republican-led state of Mississippi has taken the next step in its long-running spat with BlackRock by issuing a cease-and-desist order over the investment firm’s ESG principles.

On Wednesday, Michael Watson, the secretary of state of Mississippi, filed an order accusing BlackRock of making false claims and withholding important details about its ESG, SSG, and governance plans. The ruling comes only one week after Texas disclosed a substantial divestiture from the world’s largest money manager.

According to the letter, BlackRock is working toward its “net zero” carbon emissions objective by incorporating environmental, social, and governance (ESG) considerations into its non-ESG investment funds. Additionally, the ruling serves as notice that BlackRock will be subject to administrative fines for its use of environmental, social, and governance (ESG) considerations in managing investment accounts to forestall any damage to the public.

Watson stressed that investment firms, especially those engaging in deceitful and deceptive practices, would not be permitted to force their political agenda on the people of Mississippi.

Several government agencies have already begun tackling ESG investment. For instance, the state of Texas’s school districts have chosen to defund BlackRock’s $8.5 billion pension fund. Florida passed a resolution in 2022 forbidding state fund managers, including pension funds, from using environmental, social, and governance (ESG) considerations.

In addition, various public entities have taken steps to address ESG investing. For instance, Texas schools have withdrawn their $8.5 billion pension fund from BlackRock. In 2022, Florida implemented a resolution prohibiting state fund managers, including pensions, from considering ESG factors when managing funds.

Environmental, social, and governance (ESG) investment has come under fire from all quarters, including lawmakers. The chairman of the House Judiciary Committee, Jim Jordan, issued subpoenas to large financial institutions, including BlackRock, in December on allegations of collusion.

Claims of conspiracy stem from the fact that several financial institutions are members of the Climate 100+ environmental organization. Even though BlackRock pulled out of the coalition early this year in its domestic operations, it is still involved via its global arm.