DE: Wirecard investors sue BaFin

Mar 25, 2022 Benn-Ibler Rechtsanwälte

The Frankfurt am Main Regional Court had to decide on four claims for damages brought by Wirecard investors against the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin).

In the middle of 2020, the balance sheet fraud of the payment service provider and DAX company Wirecard came to light. It had falsified its balance sheets and around EUR 1.9 billion, which corresponded to approximately a quarter of its total assets, did not exist. Banks and investors were thus deprived of billions, because they trusted the audited balance sheets by the auditors Ernst & Young, who confirmed an annual growth of the company of 30-40 percent. As a result, BaFin, the institution responsible for balance sheet control, came under massive criticism. It was accused of not having uncovered the balance sheet scandal in time despite numerous indications due to its too slow action and the insufficient review of Wirecard's annual financial statements and annual report, and of having insufficiently informed the public. BaFin employees are also accused of abusing their office. Wirecard investors are therefore now demanding damages from the financial supervisory authority.

The chamber has now ruled out an official liability claim. BaFin had not violated any official duty incumbent upon it towards a third party. The plaintiffs are not among the group of persons to be protected under the Financial Services Supervision Act. According to this law, BaFin never acts in the individual interest of investors, but exclusively in the public interest. According to the judge, the individual investors are only indirectly protected by BaFin's banking supervisory activities as a reflexive consequential effect of the companies supervised in the public interest.

A misuse of authority was also denied. For such an abuse to exist, particularly reprehensible conduct based on irrelevant and purely personal motives is required. The mere fact that BaFin employees themselves owned and traded Wirecard shares does not constitute the required immoral conduct.

In addition, the lawsuits failed because the investors would first have had to use other means of compensation, such as possible claims against Wirecard board members. This is because public liability claims are subsidiary in the case of only negligent conduct.

LG Frankfurt am Main, 2-04 O 65/21 (19.01.2022)