Kentucky banking trade group sues state AG over ESG policy claims | Techy Kings


The Kentucky Bankers Association sued the attorney general, Daniel Cameron, this month in district court for allegedly exceeding his legal authority by asking six of the nation’s largest banks to produce documents and other information related to their environmental, social and governance (ESG) lending practices. .

Cameron is one of more than a dozen Republican attorneys general who sent civil investigative demands (CIDs) to JPMorgan Chase, Bank of America, Citi, Wells Fargo, Goldman Sachs and Morgan Stanley seeking information about their participation in the UN-backed Net-Zero Banking Alliance .

Claims piggyback on actions this summer from two states: Texas in August required the state’s pension fund to divest from asset manager BlackRock and several foreign banks seen as “boycotting” the fossil fuel sector unless the companies defend their policies to the government’s satisfaction. .

West Virginia a month earlier said it would stop giving new state business to BlackRock, JPMorgan Chase, Wells Fargo, Goldman Sachs and Morgan Stanley over the companies’ decision to cut funding to coal companies.

Under Kentucky law, the state Department of Financial Institutions — not the attorney general — can regulate and demand information from banks, the trade association, which represents 150 banks doing business in Kentucky, pointed out in its court filing.

The attorney general can issue investigative demands under the state’s Consumer Protection Act, but Cameron is not investigating anything illegal under that statute — and is seeking information outside the state, the association said.

Describing Cameron’s request as a “stunning and disturbing overreach,” the association said the CID “clearly creates an unreasonable burden and government investigation on businesses and people who may be concerned about, discussing, or thinking about global climate change or environmental activities,” according to Louisville Courier Journal.

Further, the association said, Cameron’s efforts were “a wasteful and unwarranted expenditure of taxpayer funds.”

Cameron’s office filed paperwork asking that the case be transferred to federal court.

The trade association said participating banks were heavily involved in relief and investment efforts following the tornadoes that hit the western part of the state in 2021 and the floods that hit eastern districts this year, adding that many discussed whether the weather events “exacerbated .” by climate change.”

One concern raised by the association is whether the information Cameron is seeking includes “loans to affected persons that involve repayment risk that may include the borrower’s ‘ESG Factors,'” according to the filing.

The trade association, in a second charge, said Cameron violated the bank’s rights to freedom of speech and association because “the existence of the CID…chills Plaintiffs’ right to think, speak and associate freely and without undue government intrusion or criticism.”

“In effect, the CID is establishing a continuous system of state surveillance of the recipient’s communications and activities and with the persons who interact with the recipient,” the filing said, according to the Courier Journal.

The filing contains a third count as well – alleging Cameron violated a state Senate bill, passed this year, that puts the state treasurer in charge of compiling a list of companies seen as boycotting certain forms of energy. Under the measure, the attorney general can only make a claim after a civil action has been brought against the bank.

Cameron, meanwhile, has pushed ahead in his campaign to scrap “woke” ESG policies. His office on Monday announced new investigations into the ESG investment practices of State Street and Vanguard, which received CIDs related to their membership of the Glasgow Financial Alliance for Net Zero, Climate 100+ and Net Zero Asset Managers.


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