BaFin Suspends Employee Over Alleged Wirecard Insider Trading


German financial watchdog BaFin has filed a criminal complaint against one of its employees who is suspected of having used insider information when trading Wirecard shares last summer.

January 28, 2021 | AtoZ Markets – Germany’s Federal Financial Supervisory Authority (BaFin) said on Thursday it had filed a criminal complaint against one of its employees for suspected insider trading in collapsed payments company Wirecard.

BaFin Suspects Employee of Wirecard Insider Trading

The unidentified suspect is an employee of the securities supervision department and sold structured products based on Wirecard on June 17 last year, BaFin said.

That was just a day before the company said its auditor EY was unable to confirm the existence of 1.9 billion euros ($2.3 billion) in cash balances on trust accounts. Wirecard filed for insolvency on June 25.

Read also: BaFin Ignored Commerzbank’s Warning Over Wirecard Fraud

BaFin said it had suspended the employee and opened disciplinary proceedings. The complaint was filed with state prosecutors in Stuttgart.

BaFin has come under fierce criticism for failing to spot Germany’s biggest post-war corporate fraud, though the finance minister initially said that the regulators had done a good job.

Fabio De Masi, one of the German lawmakers driving a parliamentary inquiry into the affair, said:

“The finance ministry saw no need to take action on insider trading at the supervisory authorities at the outset of the Wirecard scandal. There is still a need to apply stricter EU rules on insider trading to German authorities. We need rules for ministries and the Bundestag.”

BaFin officials bought and sold Wirecard shares in ever higher volumes as the payments company edged towards collapse, the German government has revealed.

BaFin has recently banned such trades by employees.

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