VanEck Settles SEC Charges, Faces $1.75M Fine Over Lack of Disclosure on Influencer's Role in ETF Launch

The Securities and Exchange Commission (SEC) has revealed that registered investment adviser Van Eck Associates Corporation will pay a $1.75 million civil penalty to settle allegations of failing to disclose a social media influencer's involvement in the launch of its new exchange-traded fund (ETF).

The SEC's order outlines that, in March 2021, Van Eck Associates introduced the VanEck Social Sentiment ETF (NYSE:BUZZ), designed to track an index based on positive insights from social media and other sources. The SEC found that Van Eck Associates neglected to disclose the influencer's planned role and the associated fee structure to the ETF's board during the approval process. Van Eck Associates agreed to the SEC's order, acknowledging violations of the Investment Company Act and Investment Advisers Act, and consenting to a cease-and-desist order, a censure, and the monetary penalty without admitting or denying the SEC's findings.

The SEC's investigation was led by Salvatore Massa, Gregory Padgett, and John Farinacci under the supervision of Virginia Rosado Desilets, Andrew Dean, and Corey Schuster from the Enforcement Division's Asset Management Unit.

Resources:

SEC.GOV