BERLIN – Germany's finance minister on Tuesday unveiled plans to strengthen the country’s financial supervisory authority following the accounting scandal at payment systems provider Wirecard, promising that the agency will gain “bite.”
Olaf Scholz's ministry had announced on Friday that regulator BaFin's president, Felix Hufeld, was stepping down to make possible a “new beginning” at the top. BaFin's executive director for securities supervision, Elisabeth Roegele, is also leaving.
One-time tech star Wirecard filed for protection from creditors through insolvency proceedings in June after admitting that 1.9 billion euros ($2.3 billion) that was supposedly held in trust accounts in the Philippines probably did not exist.
German authorities have been criticized for failing to step in sooner despite reports of irregularities dating back at least five years.
“I want a financial supervisor with bite,” said Scholz, who is also Germany's vice chancellor, as he presented his reform plans for BaFin. “I want tough supervision of the financial markets — that is good for the German financial market and for the protection of investors.”
Scholz's plans call for focused supervision of complex companies that would give the regulator an overview of all business areas and developments on the market.
They foresee a new “task force” that will be able to carry out special audits, and the hiring of additional auditors and others.
“It's important to me that, in the future, we systematically collect and evaluate information from whistleblowers,” Scholz said. “It is clear that information from whistleblowers is particularly welcome for BaFin's work.”
There will be regular exchanges with consumer protection groups and nongovernmental organizations, Scholz said.