(Bloomberg) -- Australia’s federal court said Vanguard Investments Australia Ltd. broke the law by making misleading claims about the credentials of a bond fund, marking the watchdog’s first ruling on greenwashing. 

Justice O’Bryan found that Vanguard made numerous false or misleading representations about the screening process used to rank environmental, social and governance factors of the Vanguard Ethically Conscious Global Aggregate Bond Index Fund, according to a statement from the Australian Securities & Investments Commission Thursday.

“By Vanguard’s own admission, it misled investors on a number of its claims,” said ASIC Deputy Chair Sarah Court in the statement. “Vanguard promised its investors and potential investors that the product would be screened to exclude bond issuers with significant business activities in certain industries, including fossil fuels, when this was not always the case.”

Australia’s corporate watchdog has been ramping up its drive to flush out greenwashing in managed funds amid a push worldwide to more closely scrutinize claims by companies and money managers. The ruling was the regulator’s first against greenwashing, according to Court. 

A hearing is set for Aug. 1 to consider the size of a penalty. Vanguard earlier this month admitted to engaging in conduct that was liable to mislead the public and that it had made representations that were false or misleading. Vanguard has grown to manage about $8.7 trillion globally through the end of January.

A spokesperson for Vanguard didn’t reply to a request for comment. 

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