Van Eck Associates Corporation

Allegations: ON FEBRUARY 16, 2024, VAN ECK ASSOCIATES CORPORATION ("VEAC"), WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, RESOLVED AN U.S. SECURITIES & EXCHANGE COMMISSION (THE "SEC") PROCEEDING WITH RESPECT TO CERTAIN ALLEGED VIOLATIONS BY VEAC OF SECTIONS 206(2) AND 206(4) OF THE INVESTMENT ADVISERS ACT OF 1940 AND RULE 206(4)-7 THEREUNDER, AND SECTION 15(C) OF THE INVESTMENT COMPANY ACT OF 1940 (THE "ORDER"). THESE ALLEGATIONS RELATE TO THE LAUNCH OF THE VANECK SOCIAL SENTIMENT ETF (THE "BUZZ ETF"). THE SEC ALLEGED THAT FROM 2020 THROUGH 2021, VEAC DID NOT DISCLOSE TO THE BUZZ ETF'S BOARD OF TRUSTEES (THE "BOARD") A SOCIAL MEDIA INFLUENCER'S (THE "INFLUENCER") PLANNED INVOLVEMENT IN PROMOTING THE BUZZ NEXTGEN AI US SENTIMENT LEADERS INDEX (THE "BUZZ INDEX"), THE TRACKING INDEX FOR THE BUZZ ETF, AND HIS RELATED COMPENSATION THROUGH THE LICENSING AGREEMENT WITH VEAC. THE SEC FURTHER ALLEGED THAT FROM 2020 UNTIL 2021, VEAC DID NOT INFORM THE BOARD OF THE DETAILS OF THE INFLUENCER'S ARRANGEMENTS WITH THE BUZZ INDEX IN CONNECTION WITH THE BOARD'S REVIEW AND APPROVAL OF THE VEAC ADVISORY CONTRACT FOR THE BUZZ ETF, INCLUDING THE ECONOMIC TERMS OF THE LICENSING AGREEMENT VEAC HAD REACHED WITH THE INDEX PROVIDER. THE SEC ALSO ALLEGED THAT VEAC DID NOT HAVE ADEQUATE WRITTEN POLICIES AND PROCEDURES ABOUT FURNISHING THE BOARD WITH ACCURATE INFORMATION REASONABLY NECESSARY FOR THE BOARD TO EVALUATE THE TERMS OF THE ADVISORY CONTRACT, AS WELL AS MATERIAL INFORMATION RELATED TO THE PROPOSED LAUNCH OF THE BUZZ ETF. UNDER THE TERMS OF THE ORDER, VEAC WAS CENSURED AND ORDERED TO CEASE AND DESIST FROM VIOLATIONS OR FUTURE VIOLATIONS OF SECTION 15(C) OF THE INVESTMENT COMPANY ACT AND SECTIONS 206(2) AND 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7 THEREUNDER. VEAC AGREED TO PAY $1.75 MILLION IN A CIVIL PENALTY. Status: Final Sanction Detail: A CIVIL MONETARY PENALTY OF $1,750,000 WAS PAID ON FEBRUARY 20, 2024. Summary: ON FEBRUARY 16, 2024, THE U.S. SECURITIES AND EXCHANGE COMMISSION ("SEC") ANNOUNCED A SETTLEMENT WITH VAN ECK ASSOCIATES CORPORATION ("VEAC") THAT AROSE OUT OF ALLEGATIONS OF DISCLOSURE DEFICIENCIES CONCERNING THE LAUNCH OF THE VANECK SOCIAL SENTIMENT ETF (THE "BUZZ ETF"). VEAC NEITHER ADMITTED NOR DENIED THE SEC'S FINDINGS. THE DISCLOSURES PRINCIPALLY RELATE TO THE ECONOMIC TERMS OF THE LICENSING AGREEMENT REACHED WITH THE INDEX PROVIDER OF THE BUZZ NEXTGEN AI US SENTIMENT LEADERS INDEX (THE "BUZZ INDEX"), A SOCIAL MEDIA INFLUENCER'S PLANNED INVOLVEMENT IN PROMOTING THE BUZZ INDEX AND THE COMPENSATION PAID TO THE INFLUENCER AND THE CONTROVERSIES SURROUNDING THE INFLUENCER. THE SEC CONSIDERED THE REMEDIAL ACTS UNDERTAKEN BY VEAC, AND, UNDER THE TERMS OF THE SETTLEMENT, VEAC AGREED TO PAY $1.75 MILLION IN A CIVIL PENALTY.