Bafin Executive Director Béatrice Freiwald is threatened with extinction.

Beatrice Freiwald

The lawyer, whose contract runs until the beginning of 2024, has long been considered a shaky candidate in the authority.

(Photo: Bernd Roselieb/BaFin)

Frankfurt The Bafin Executive Director Béatrice Freiwald, who came under pressure in the wake of the Wirecard scandal, is threatened with extinction. The Federal Ministry of Finance had already informed her on October 14, 2021 that it intended “to dismiss her as Executive Director of Bafin for good cause,” according to a decision by the Berlin-Brandenburg Higher Administrative Court, which has now been published.

According to the court, Freiwald considered her planned dismissal to be unlawful and therefore took legal action against it in advance. However, the administrative court in Berlin rejected her application for preventive legal protection. On August 30, the Higher Administrative Court rejected an appeal against this decision.

“Even in the complaints procedure, the applicant is unable to show any reason that could constitutionally justify breaking the separation of powers and here (…) prohibiting a member of the Federal Government from introducing a cabinet bill,” writes the Higher Administrative Court. The “applicant can easily be expected to wait for the Federal Government’s decision on her dismissal”.

Freiwald, whose contract as executive director runs until the beginning of 2024, has long been considered a shaky candidate in the Bafin. She was severely criticized in the Wirecard investigation committee – among other things, because she was responsible for the Bafin whistleblower office, which did not adequately investigate information from whistleblowers about Wirecard.

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Above all, however, she was accused of the very lax handling of the financial supervisory authority with private securities transactions by their employees. Since she was also responsible for compliance until a few months ago, she is held responsible for ensuring that compliance with the already quite permissive requirements was also checked in a comparatively lax manner.

>> Read here: Wirecard affair: Bafin neglected its internal controls for years

The private share transactions of the Bafin employees developed into a political issue because many employees of the supervisory authority had traded shares and derivatives of the now insolvent payment service provider. The grand coalition has significantly tightened the rules for such private transactions in response to the scandal.

Mark Branson at the “Euro Finance Week” in Frankfurt am Main

The Bafin President has already internally as good as disempowered Freiwald.

(Photo: dpa)

In addition, the Bafin will be fundamentally restructured. President Mark Branson, who has been in office since August 2021, has already largely disempowered Freiwald internally. In December 2021, he relieved her of responsibility for law and compliance, and in April 2022 also responsibility for human resources and IT.

According to the court order, the Ministry of Finance justified the intended dismissal of Freiwald with the restructuring of the Bafin, among other things. In addition, Finance Minister Christian Lindner and Bafin President Branson “did not have the necessary confidence that the technological transformation and personnel development could succeed under the management of the business area in question by the applicant”. Both are of central importance for the modernization of the Bafin.

The court considers Freiwald’s dismissal to be obvious

In its decision, the Higher Administrative Court makes it clear that it considers the planned dismissal of Freiwald to be justified for important reasons. After the Wirecard scandal, it was a matter of flanking an “objectively justified and politically necessary reorganization in terms of personnel policy and a publicly shaken trust in the quality of supervision and the qualifications of the people entrusted with it, including in terms of personnel, as quickly as possible to be able to recover”.

The fact that Freiwald should now also go alongside the then Bafin President Felix Hufeld and his deputy Elisabeth Roegele was “by no means arbitrary”. Rather, it makes sense to “dismiss the member of the Board of Directors who was responsible at management level for the cross-sectional area of ​​law and compliance, which encompasses all areas of financial supervision, during the events surrounding Wirecard AG – regardless of any specific personal allegations”.

Freiwald, who, according to the decision, last received an annual official salary of EUR 219,690.72 gross, did not respond to a request on the subject. The financial supervisory authority Bafin and the Federal Ministry of Finance asked for understanding “that we do not comment on personnel decisions”.

More: Internal emails and chats incriminate Markus Braun – Exclusive details on the charges against Wirecard boss

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