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New York AG Accuses Exxon Mobil Of Defrauding Investors Over Climate Change Policies

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New York AG Accuses Exxon Mobil Of Defrauding Investors Over Climate Change Policies

Exxon Mobil Corporation (NYSE: XOM) stock traded lower by 1.2 percent Wednesday. The New York Attorney General filed a lawsuit against the company alleging that it misled investors about the risks associated with climate change.

What Happened

New York Attorney General Barbara Underwood filed a lawsuit against Exxon claiming former CEO Rex Tillerson was aware of the company’s misrepresentation of climate change risks “for years.”

Why It’s Important

Exxon has repeatedly assured investors it was preparing for the potential financial impact of new climate change regulations, but Underwood claims the company was in fact at more risk than it disclosed.

“Exxon did not abide by these representations, and instead did much less than it claimed, deceiving investors as to the company’s true financial exposure to increasing regulations and policies adopted to mitigate the adverse effects of climate change,” the attorney general said in a press release.

Even amid a significant rebound in crude oil prices in 2018, Exxon Mobil stock has lagged the market and is now down 9.9 percent overall in the past five years.

What’s Next

Investors will be watching closely to see whether or not the lawsuit will result in fines or penalties for Exxon. Perhaps more importantly, they will be waiting to see if the company will, in fact, be subject to more climate-change=related costs in the long-term than it has previously indicated.

The stock traded around $78.85 at time of publication.

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Photo credit: WClarke, from Wikimedia Commons

Posted-In: Barbara Underwood Rex TillersonNews Legal Best of Benzinga

 

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