Germany’s financial regulator, BaFin, imposed two administrative fines totaling €560,000 on flatexDEGIRO Bank AG for breaches of the German Securities Trading Act.

According to BaFin, at the beginning of 2022, flatexDEGIRO Bank advertised free investment services on two of its websites without clearly stating that a regular processing fee would apply. The company “adjusted its practices” later that year to “align with legal requirements.”

FlatexDEGIRO, the retail arm of flatexDEGIRO Bank AG, serves around 3 million accounts and processes over 60 million securities transactions annually.

Marketing Must Be Fair and Clear

BaFin emphasized that information published by investment services providers must be “fair and clear.” This requirement applies especially to marketing communications, including company websites, and is intended to protect customers from misleading statements.

Balanced Disclosure Required by Law

Under the WpHG, investment services providers must present both the benefits and risks of services, such as brokerage or financial products, in a balanced and transparent manner.

• Trusts Tested, Shareholders Push Back, and AI Tackles FX
• New MiFID II Reporting Proposal: CFDs Brokers Need to Tag Retail and Professional Clients
• Retail Chaos and Market Shocks: How Can Brokers Survive the Trump Era?

Companies are required to highlight relevant risks alongside any potential advantages. These obligations are further specified in EU regulations and in MiFID II guidance.

Company Response on Fine

Finance Magnates reached out to flatexDEGIRO for comment. The company said: “We had anticipated a fine of this amount and had already made the corresponding provisions."

"We also actively addressed this in the publicly available analyst call for the third quarter of 2025. The fine therefore has no material impact on our expected consolidated net income of €150–160 million in 2025.”

Regulatory Breach Details

BaFin noted that flatexDEGIRO Bank’s advertising of free services without explicitly mentioning the processing fee violated these provisions. The regulator can impose fines up to €5 million or 10% of a company’s total revenue for such breaches.

Previous Compliance Issues

The bank confirmed that it took corrective measures in 2022 to ensure compliance with the legal requirements. In 2023, BaFin imposed a €1.05 million fine on flatexDEGIRO Bank AG for breaches of banking supervisory rules.

The regulator also required the company to address serious lapses in internal controls, including supervisory reporting and anti-money laundering measures, and appointed a special representative to monitor implementation.