Description: Investigation by New York Attorney General of coal company's disclosures to investors of climate change-related risks.
In re Peabody Energy Corp.
Filing Date Type File Action Taken Summary 11/08/2015 Assurance of Discontinuance Download Assurance of discontinuance signed. New York Attorney General Settled with Peabody Energy After Investigation of Company’s Disclosures of Climate Policy Risks. On November 8, Peabody Energy Corporation reached a settlement with the New York State Attorney General’s Office (NYAG) in which the company agreed to revise its financial disclosures to reflect the potential impact of climate change regulations on its future business. The settlement followed an investigation by the NYAG concerning Peabody’s disclosure of financial risks associated with climate change policies in filings to the Securities and Exchange Commission (SEC). The NYAG found—and Peabody neither admitted nor denied—that Peabody had repeatedly denied its ability to reasonably predict the potential impacts of climate change policies on future operations, financial conditions, and cash flows, while at the same time making market projections about the impact of future climate change policies, some of which concluded that regulatory actions could have a severe negative impact on Peabody’s future financial condition. The NYAG also found that Peabody misrepresented findings and projections of the International Energy Agency regarding global coal demand in SEC filings and in communications to the investment community and general public. The NYAG concluded that Peabody had violated New York’s Martin Act, which forbids financial fraud. In the assurance of discontinuance of the investigation, Peabody agreed to add specific language on climate policy risks in its next quarterly report and to acknowledge potential effects of climate regulation on demand for Peabody’s products and securities.