Germany’s financial regulator BaFin issued new requirements for brokers after April’s system outages, which left investors unable to place trades during sharp market swings.
BaFin Clarifies Broker Obligations
In a supervisory notice published this month, BaFin said banks and brokers must ensure that customers can execute trades without disruption, even during periods of heavy demand.
“Institutions must minimize the risk of technical problems occurring again when large numbers of customers access their systems simultaneously during strong market movements,” said Director Dr. Thorsten Pötzsch. “They must plan their capacities with foresight. We expect them to test their systems at several times their usual capacity continuously.”
The regulator said institutions must test their IT systems at several times their normal capacity, plan ahead for spikes in activity, and maintain contingency measures. Emergency planning and clear communication with customers are now key supervisory expectations.
The new rules follow outages in early April, when U.S. tariff announcements triggered record traffic on trading apps. According to BaFin, the interaction between different brokers’ systems created bottlenecks, leading to widespread technical failures despite each institution claiming its systems could handle peak loads.
April Disruptions Prompt Action
A BaFin market survey of universal banks, direct banks, and neobrokers confirmed the scale of the problem. The regulator used the findings to set new standards across the brokerage industry.
BaFin said it will continue to investigate the outages and conduct further audits of affected firms. If breaches of supervisory requirements are found, enforcement measures will follow.
Elsewhere, BaFin has stepped up its oversight of social media activities. The watchdog recently opened an investigation into Aurealis Capital and Minexra, accusing the two firms of illegally offering financial and cryptocurrency services to local investors.
Related: More Firms Caught Promoting Unauthorized Investments in WhatsApp Groups, German Watchdog Warns
The regulator said the companies are using WhatsApp groups to market trading strategies and investment opportunities, despite lacking the licenses required to operate in Germany.
According to BaFin, Aurealis Capital and Minexra attract potential investors through social media advertisements that direct users into private WhatsApp groups. BaFin warned that such activities breach German laws governing financial and cryptoasset services, which mandate prior regulatory approval.
The watchdog added that operators of these platforms often shift their web domains, making it harder to track them and leaving investors exposed to significant risks.
