Germany’s financial regulator, BaFin, imposed twoadministrative fines totaling €560,000 on flatexDEGIRO Bank AG for breaches ofthe German Securities Trading Act. According to BaFin, at the beginning of 2022, flatexDEGIROBank advertised free investment services on two of its websites without clearlystating that a regular processing fee would apply. The company “adjusted itspractices” later that year to “align with legal requirements.”FlatexDEGIRO, the retail arm of flatexDEGIRO Bank AG, servesaround 3 million accounts and processes over 60 million securitiestransactions annually.Marketing Must Be Fair and ClearBaFin emphasized that information published by investmentservices providers must be “fair and clear.” This requirement appliesespecially to marketing communications, including company websites, and isintended to protect customers from misleading statements.Balanced Disclosure Required by LawUnder the WpHG, investment services providers must presentboth the benefits and risks of services, such as brokerage or financialproducts, in a balanced and transparent manner. Companies are required tohighlight relevant risks alongside any potential advantages. These obligationsare further specified in EU regulations and in MiFID II guidance.Company Response on FineFinance Magnates reached out to flatexDEGIRO for comment.The company said: “We had anticipated a fine of this amount and had alreadymade the corresponding provisions.""We also actively addressed this in thepublicly available analyst call for the third quarter of 2025. The finetherefore has no material impact on our expected consolidated net income of€150–160 million in 2025.”Regulatory Breach DetailsBaFin noted that flatexDEGIRO Bank’s advertising of freeservices without explicitly mentioning the processing fee violated theseprovisions. The regulator can impose fines up to €5 million or 10% of acompany’s total revenue for such breaches.Previous Compliance IssuesThe bank confirmed that it took corrective measures in 2022to ensure compliance with the legal requirements. In 2023, BaFinimposed a €1.05 million fine on flatexDEGIRO Bank AG for breaches ofbanking supervisory rules. The regulator also required the company to addressserious lapses in internal controls, including supervisory reporting andanti-money laundering measures, and appointed a special representative tomonitor implementation.This article was written by Tareq Sikder at www.financemagnates.com.