We can't possibly believe that the pristine ratings agencies - like the ones that once helped cause an entire global economic collapse in 2007-08 - are once again finding themselves under scrutiny by regulators.
But this time, it's over what we have constantly criticized as one of the biggest scams to ever hit the investing world: ESG.
The latest light to be cast has come from the Missouri Attorney General's office, which is looking into ratings agency Morningstar, seeking to find out whether or not the agency "violated state consumer-protection law through the firm’s evaluation of ESG issues," according to a Tuesday Bloomberg wrap up.
Missouri Attorney General Eric Schmitt's office confirmed to Reuters this week that the review of Morningstar is also to see if they violated state laws "aimed at protecting Israel from a campaign to isolate the Jewish state over its treatment of Palestinians," the report said.
They sent civil investigative demands to the company and its Sustainalytics ESG-ratings unit. Potential wrongdoing may have occurred "through the sale of ESG products to Missouri-based businesses and other consumers, such as if the products overly emphasized the risk for companies of doing business in Israel," the Reuters report says.
Schmitt's investigation is the first instance of a state looking into ESG ratings, the report says. In our guess, it won't - and shouldn't - be the last. His office commented: "Missouri has been a leader in pushing back against woke ESG investing, and my office will continue to look out for consumers."
Morningstar CEO Kunal Kapoor went on record and said that the company is evaluating Schmitt's investigation.
"Sustainability introduces new choices for investors; Morningstar provides the data and insights to help investors of all types weigh those choices in their decision making," he said.