On February 4, 2025, an administrative fine totaling EUR 23.05 million was levied by Germany’s Federal Financial Supervisory Authority (BaFin) due to various compliance failures attributed to a major financial institution. These violations specifically related to organizational requirements under the German Securities Trading Act concerning the sale of derivatives.
The scrutiny emerged following the institution’s handling of a sale of currency derivatives in Spain, where it was found to have inadequately investigated infringements and addressed related issues in a timely manner. This lack of responsiveness prompted actions from the Spanish National Securities Market Commission, which initiated sanctioning proceedings against the entity.
Additionally, the operational arm known as Postbank failed to meet regulatory obligations regarding the documentation of investment advice. Despite temporary exemptions during the COVID-19 pandemic, once those allowances ended, the institution repeatedly neglected to ensure that investment advice delivered via telephone was properly recorded as mandated.
Another area of concern was Postbank’s processing of applications under the German Payment Accounts Act, where it was noted that numerous applications for account switching services were either not handled at all or faced significant delays.
In total, the fine encompasses several components: EUR 14.8 million is attributed to shortcomings in derivatives sales practices, EUR 4.6 million relates to failures in recording telephone conversations for investment services, and EUR 3.65 million is for ineffectiveness in processing account switching requests. The ruling by BaFin marks the conclusion of the administrative fine proceedings, making the financial penalty definitive and enforceable.