SEC Fines Van Eck $1.75 Million for Failure to Disclose Social Media Influencer’s Role in ETF Launch

• SEC fines Van Eck $1.75 million for failing to disclose influencer’s role in ETF launch.
• Van Eck omitted details about the influencer’s role and the fee structure from the ETF’s board during the approval process
• The firm agreed to a cease-and-desist order, a censure, and a monetary penalty.

The U.S. Securities and Exchange Commission (SEC) has levied a $1.75 million civil penalty against registered investment adviser Van Eck Associates Corporation. The penalty settles charges that Van Eck failed to disclose a social media influencer’s involvement in the launch of its new exchange-traded fund (ETF).

The SEC’s order reveals that in March 2021, Van Eck Associates introduced the VanEck Social Sentiment ETF. The service was designed to monitor an index based on “positive insights” from social media and other data sources. 

However, the company failed to disclose the intended participation of a well-known and controversial social media influencer in promoting the index alongside the ETF launch.

According to the SEC, the index provider had planned to engage the influencer to boost the index’s visib…

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