Erscheinung:22.01.2021 | Topic Unauthorised business Bred Finance: BaFin prohibits unauthorised lending business
In a notice dated 11 December 2020, BaFin ordered a company conducting business under the name of Bred Finance to immediately cease its unauthorised lending business. The company purports to be domiciled in the United Kingdom.
Bred Finance uses an online platform to offer loans to German-speaking customers. Potential borrowers are presented with a loan agreement entitled “The ministry of justice and the legalization [new line] Human rights / Finance Loan”, which the company claims has been filed with a London law firm. In some cases Bred Finance persuades German customers to send the company their EC card and all their access data to allegedly enable the company to provide the desired loan.
Bred Finance thus conducts lending business as defined in section 1 (1) sentence 2 no. 2 of the KWG on a commercial basis. The company does not hold authorisation from BaFin as required under section 32 (1) of the KWG and is therefore conducting unauthorised business.
German borrowers sometimes receive e-mails in connection with the loans; these e-mails have been sent from the address bafincontact@gmail.com, aimed at enhancing the credibility of Bred Finance. Some of these messages call on the recipients to make a tax payment that is allegedly due. BaFin emphasises that such communications are never sent by BaFin but are solely meant to give the recipients the impression that the company is trustworthy and to prompt them to transfer additional sums of money.
