The head of Germany鈥檚 financial watchdog defended the agency amid growing criticism over Wirecard AG鈥檚 collapse.
BaFin is doing exactly what German lawmakers asked, with a mandate that only allowed it to supervise small parts of the payments company, Felix Hufeld, the agency鈥檚 president, said in an interview with the Welt am Sonntag newspaper. It鈥檚 up to lawmakers to improve the regulation of tech firms, where there are lots of gray areas, he said.
Mr. Hufeld鈥檚 comments come as questions mount over how Wirecard, which straddled banking and technology, survived so long before disclosing last month that 1.9 billion euros ($2.2 billion) were missing from its balance sheet. The company filed for insolvency with a German court and several top executives have been arrested.
Wirecard escaped strict scrutiny for years as BaFin focused solely on its banking unit. The government is now overhauling who regulates who, potentially ushering in a regulatory rethink with consequences for the broader fintech industry.
The demands of some lawmakers to refashion BaFin along the lines of the US Securities and Exchange Commission (SEC) isn鈥檛 sufficient, Mr. Hufeld told Welt am Sonntag. 鈥淲e can learn from the SEC model, but there are cases of fraud there, too,鈥 he said. 鈥淭he US also has a different system of justice, that鈥檚 not easily transferred into Europe.鈥 鈥 Bloomberg
