BaFin’s Consumer Protection Directorate

BaFin has its own directorate dedicated to consumer protection, located at both BaFin offices: Bonn and Frankfurt am Main.

The Director-General for Consumer Protection, as BaFin’s he Investor and Consumer Protection Officer, advises BaFin’s Executive Board. By setting up this function in 2021, BaFin has strengthened its commitment to consumer protection.

Supervisory instruments 

Transparency

As a consumer, you should be able to make your own decisions on financial matters without being told what to do. BaFin works to ensure that the information provided on financial products, insurance products and financial services is transparent and comprehensible. Prospectuses for securities and capital investments, for example, help you as a consumer to better assess investment products. Providers must structure their information in terms of content and form in such a way that it suits the knowledge and needs of consumers.

Consumer information

BaFin provides you as a consumer with a wide range of information specially designed to strengthen your financial literacy and help you to make independent financial decisions. Its aim is to give you some initial guidance and make it easier for you to compare offers – without recommending any particular product or course of action. 

BaFin addresses its guidance to various target groups and their life situations. Amongst other things, it offers financial planning/investment guides for young people on leaving school and for senior citizens in retirement. 

On its website, BaFin provides general information on investing. It also provides specific information – such as how securities work and the risks they entail, or the most important banking and insurance products. BaFin’s range of information resources also includes brochures and videos. 

BaFin is a partner in the initiative to promote financial education that was introduced by, among others, the Federal Ministry of Finance (BMF)The aim of the initiative is to sustainably improve financial education in Germany. On the initiative’s financial education platform, consumers can find financial education programmes that suit their particular stage of life. 

Conduct of business obligations 

BaFin checks, for example, whether credit institutions and insurance companies comply with their conduct of business obligations in their dealings with customers.

Important insights in this respect are gained primarily from BaFin’s supervisory visits and inspections at companies. 

One such obligation is that advisers providing investment advice are only permitted to recommend those products that are suitable for you. BaFin makes sure this is documented in a suitability report. 

Consumer complaints 

If you have trouble for example with a credit institution or insurance company, you can file a complaint with BaFin. Customer complaints provide important information about the issues and problems that particularly concern consumers. Furthermore, complaints can help reveal errors in those organisational arrangements of companies supervised by BaFin that affect the collective interests of consumers. Complaints are therefore an important source of information for BaFin.

Product intervention

Where the shortcomings are serious, BaFin may even restrict or prohibit the distribution of products. This is the case, for example, if there are major investor protection concerns or risks for the orderly functioning and integrity of financial markets. 

Cooperation on consumer protection and involvement in international bodies 

To ensure effective consumer protection, BaFin works together with German consumer organisations (Verbraucherzentralen) as well as the German Centre for Protection against Unfair Competition (Wettbewerbszentrale).

At the same time, BaFin does not consider consumer protection merely a national concern: it is actively involved in European and global committees, working groups and forums. These are opportunities for BaFin to contribute to the ongoing development of the international standards of collective consumer protection.