Germany's Federal Financial Supervisory Authority, BaFin, has imposed fines totalling €520,000 on UmweltBank AG following findings that the bank's compliance function under the Securities Trading Act — known in Germany as the Wertpapierhandelsgesetz, or WpHG — was inadequately staffed for a continuous period of four years. The fines were imposed on 3 April 2025 and published by BaFin on 17 April 2025; BaFin noted that the bank could lodge an objection against the decision.
UmweltBank AG is a Nuremberg-based lender that specialises in environmental and sustainability financing.
FOUR YEARS OF UNDERSTAFFING CITED
According to BaFin, the WpHG compliance function at UmweltBank was inadequately staffed from 2020 through to 2023 — a lapse spanning four consecutive years. In addition, the compliance report for the 2021 and 2022 reporting period was not submitted in full to senior management.
BaFin had already escalated its scrutiny of UmweltBank prior to the penalty: on 26 February 2024 it appointed a special commissioner to monitor that the bank ensured proper business organisation, and ordered it to remedy deficiencies in meeting WpHG conduct and organisational requirements; in June 2023 it had already ordered the bank to ensure proper business organisation.
REGULATORY FRAMEWORK
Under the WpHG framework, investment services firms and banks providing investment services are required to maintain a permanent and effective compliance function that is appropriately resourced.
BaFin publishes enforcement decisions of this nature on its website as part of its transparency obligations.
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