Federal Court of Justice: no official liability on the part of BaFin in the Wirecard case

In the so-called Wirecard scandal, the Federal Court of Justice ruled that the Federal Financial Supervisory Authority (BaFin) had not breached its duties to supervise compliance with, among other things, the provisions of the German Securities Trading Act (WpHG), in particular balance sheet control and market abuse monitoring.

BaFin is therefore not liable for investor losses in connection with the Wirecard insolvency. There is also no state liability claim under EU law.

As Wirecard AG itself was not a financial services provider, BaFin was responsible in particular for monitoring the balance sheet.

First of all, the BGH clarified in its decision of 10.01.2024 (III ZR 57/23) that the liability of BaFin is to be assessed in accordance with the previous case law according to the principles of official liability. The decisive factor here is the ex-ante view based on the respective state of knowledge at the time of the audits at the time.

In principle, it was not objectionable that the BaFin partly used an association organized under private law, the German Financial Reporting Enforcement Panel (FREP), to perform its tasks. The two-stage procedure pursuant to Sections 37n et seq. WpHG (old version) and §§ 106 ff. WpHG (in the version applicable from 3 January 2018), in which the BaFin was only directly responsible at the second stage if a company refused to cooperate with the FREP or if there were significant doubts about a proper examination by the FREP, was sufficient. Under section 342b (4) sentence 1 HGB (old version), companies had to provide information to the FREP upon request and the FREP had to report suspected criminal offenses.

The BGH also pointed out that the law had given the BaFin a margin of discretion by using undefined legal terms ("concrete indications", "significant doubts"). The court could therefore not examine whether BaFin's actions were correct - there were several correct forms of conduct - but only whether BaFin's actions were justifiable.

Furthermore, the BGH examined in more detail for the individual periods when BaFin reacted to which information (such as press reports, postponement of the auditor's report) and to what extent. This was justifiable in each case, including the request for an audit of the condensed consolidated financial statements pursuant to section 108 (2) WpHG (old version), the instruction to the FREP to take certain press reports into account in the audit, the audit due to suspected market manipulation, requests for administrative assistance to the Malaysian authorities and information to the Munich public prosecutor's office. This applies irrespective of whether the general clause of Section 6 WpHG old version of Sections 106 et seq. WpHG old version as more specific standards.

Finally, in the absence of doubts about the FREP's balance sheet control, it does not matter whether the Market Abuse Regulation (Regulation (EU) No. 596/2014) or the Transparency Directive (Directive 2004/109/EC) are to be interpreted as meaning that even simple doubts about the balance sheet control trigger a direct duty of the BaFin to examine.

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