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Another State May Be Investigating ExxonMobil for Fraudulent Statements on Climate Change

California Attorney General Kamala Harris is reportedly joining New York's chief lawyer in questioning what the oil giant knew about climate change and what it was telling its shareholders and the public.

by Rob Verger
Jan 25 2016, 6:45pm

Photo by Pat Sullivan/AP

The Exxon Mobil Corporation is facing increasing scrutiny, as California Attorney General Kamala Harris joins state and federal elected officials in investigating the company for potentially lying to shareholders and the public about links between its product and climate change, according to The Los Angeles Times.

Several media organizations have reported that the company knew decades ago that fossil fuel burning was warming the atmosphere, yet kept that information out of the public eye — and away from the company shareholders. Worse, the company funded campaigns to confuse the public on scientific certainty that the planet is warming and human activity was to blame. 

Each of the Democratic presidential candidates has called for the US Department of Justice to investigate ExxonMobil for potential fraud. And, Congressman Ted Lieu, a Democrat from California, is leading the charge in Congress for a federal probe.

"I'm very pleased Attorney General Harris has launched an investigation into ExxonMobil," he said. "With New York and California investigating ExxonMobil, I hope other states will follow as well."

New York Attorney General Eric Schneiderman launched in November an investigation of ExxonMobil. 

"Just like any other publicly traded company, these energy giants have an obligation to ensure that their disclosures to investors of known and reasonably likely risks are truthful and not misleading, and to disclose to the public the risks associated with their products," Schneiderman said. "I applaud Attorney General Harris for joining the fight."

Related: Bernie Sanders Has a Plan to Take on the Fossil Fuel Industry

Rep. Lieu pointed out that companies are prohibited from omitting or lying about material facts in their filings. Publicly traded companies like ExxonMobil must file both quarterly and annual reports to the US Securities and Exchange Commission and in those reports must disclose financial risks the company faces. 

"It's clear to me that for years and years ExxonMobil omitted a lot of material facts about what they knew about global warming and climate change," Lieu said.

Shanna Cleveland, a senior manager at Ceres, an organization that advocates for more sustainable business practices, echoed Congressman Lieu.

"One of the things I think the California and New York investigations really show," she said, "is that attorneys general and investors really believe that climate change is a serious financial risk, and one that has to be reported on in a company's public filings and communications with investors."

She said that Ceres has tried to get Exxon to be more transparent regarding its knowledge about climate change.

"There does seem to be a substantial difference between what Exxon has studied and has concluded internally, and the information that they share with the public about the risks that they face from climate change," Cleveland said.

Related: A New Front Has Opened Up in the Legal Battle Over Climate Change

Calls for Harris to launch an investigation were spearheaded by RL Miller, founder of the organization Climate Hawks Vote, which lobbies for candidates who are aggressive about tackling climate change.

Miller applauded the AG's investigation, and noted California's susceptibility to climate change, including a record drought and widespread wildfires last year. 

"I'm just happy that Kamala Harris is getting involved," she said, "and hopeful that she can bring Exxon to justice."

Alan Jeffers, a spokesman for ExxonMobil, said that the company did not comment on media reports.

"ExxonMobil has included information about the business risk of climate change for many years in our 10-K, Corporate Citizenship Report, and in other reports to shareholders," the company said in a statement.

The company also said that it had researched climate change for almost 40 years, and that it had not "suppressed" such research.

"Activists and media cherry-picked statements attributed to various company employees to wrongly suggest definitive conclusions were reached by company researchers at the early stages of scientific investigation of the potential for climate change," it said. 

Follow Rob Verger on Twitter: @robverger

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