Church of England Votes to Divest from Fossil Fuels

The Church of England has voted to dump £12 billion ($15 billion) in holdings of fossil fuel companies if they are not tackling global warming quickly enough.

The church voted 347-4 with three abstentions in favor of the changes in the General Synod, the church’s legislative body, reports Citywire. Oil and gas companies that have not aligned their businesses with the goals of the Paris Agreement by 2023 will see divestment from the £8.33 billion Church Commissioners investment fund, the Church’s £2.3 billion retirement fund, and an additional £2 billion in other Church of England funds.

The vote is based on the suggestion of Canon Giles Goddard of the church’s environmental group that the church track companies’ progress on carbon reduction by 2023. Goddard said companies not focused on the Paris Agreement’s target to reduce global temperatures by 2 degrees Celsius by that time should see divestment from the church.

In his initial proposal, Goddard pushed compliance deadlines to 2020, but the church decided 2023 would better encourage progress without “prematurely divesting” from businesses.

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At the Synod discussion, David Walker, Bishop of Manchester, said that full divestment from fossil fuel companies in 2020 would “leave our strategy and influence in tatters.” Walker also said that divestment would also relieve fossil fuel companies from compliance rather than reinforce it. He agreed with the 2023 deadline, saying that it creates enough time for engagement.

As of December, the church itself had £123 million in oil and gas investments. In 2015 and 2017, its funds cut coal miners and companies taking oil from tar sands and filed a motion with oil giant ExxonMobil on improving its climate risk disclosures.

Tags: Church of England, Endowments, ESG, Fossil Fuels

Broker-dealer Alexander Capital has agreed to be censured and pay a fine of more than $400,000 for failing to supervise brokers who “churned accounts,” made unsuitable recommendations, and made unauthorized trades that resulted in substantial losses to clients while generating large commissions.

SEC regulations require broker-dealers to supervise their employees through procedures and systems designed to prevent and detect violations of federal securities laws. In particular, broker-dealers must guide supervisors on how to identify and address potential misconduct by its registered representatives who sell securities to the public.

“Broker-dealers must protect their customers from excessive and unauthorized trading, as well as unsuitable recommendations,” Marc Berger, director of the SEC’s New York Regional Office, said in a release. “Alexander Capital’s supervisory system – and its personnel – failed its customers, and today’s actions reflect our continuing efforts to protect retail customers by holding firms and supervisors responsible for such failures.”

The SEC said Alexander Capital did not reasonably supervise brokers William Gennity, Rocco Roveccio, and Laurence Torres, who were charged with fraud in September 2017. According to the SEC’s order instituting administrative proceedings, the firm neglected to develop and implement reasonable supervisory policies and procedures, and “failed to put in place reasonable mechanisms for supervisors to use to monitor registered representatives.”

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The charges also say the company didn’t train two supervisors, nor did it implement any procedures designed to identify whether they were reviewing customer accounts for churning. Churning is when a broker engages in excessive trading in a client’s account in order to generate commissions that benefit the broker without considering the customer’s investment goals.

Alexander Capital agreed to pay $193,775 for allegedly ill-gotten gains, another $193,775 in penalties, and another $23,437 in interest. Alexander Capital also agreed to hire an independent consultant to review its policies and procedures and the systems to implement them.

In separate orders, the SEC found that supervisors Philip Noto and Barry Eisenberg ignored red flags indicating excessive trading. Noto agreed to a permanent supervisory bar, and to pay a $20,000 penalty, while Eisenberg agreed to a five-year supervisory bar, and to pay a $15,000 penalty.

Alexander Capital, Noto and Eisenberg neither admitted, nor denied the findings in the SEC’s orders.

Tags: Alexander Capital, broker, Marc Berger, Noto, SEC