The Securities and Exchange Commission today announced that Vale S.A., a publicly traded Brazilian mining company and one of the largest iron ore producers in the world, agreed to pay $55.9 million to settle charges brought last April stemming from the company’s allegedly false and misleading disclosures about the safety of its dams prior to the January 2019 collapse of the Brumadinho dam that killed 270 people. The SEC’s complaint alleged that, for years, the dam did not meet internationally-recognized safety standards even as Vale’s public sustainability reports assured investors that all of its dams were certified as stable. 

"Our action against Vale illustrates the interplay between the company’s sustainability reports and its obligations under the federal securities laws," said Mark Cave, Associate Director of the SEC’s Division of Enforcement. "The terms of today’s settlement, if approved by the court, will levy a significant financial penalty against Vale and demonstrate that public companies can and should be held accountable for material misrepresentations in their ESG-related disclosures, just as they would for any other material misrepresentations."

The settlement, which remains subject to approval by the U.S. District Court for the Eastern District of New York, requires Vale to pay a civil penalty of $25 million and disgorgement and pre-judgment interest of $30.9 million and would permanently restrain and enjoin Vale from violations of the Securities Act of 1933 and of the Securities Exchange Act of 1934.

The SEC’s litigation is being led by Dean Conway and Michelle Zamarin, under the supervision of Melissa Armstrong and Sharan Custer.