BaFin, the German financial market regulator, announced on Wednesday that it is investigating CoinsTrades, a Trading Platform . According to the note, CoinsTrades does not have authorization under the German Banking Act (KWG) to provide financial or banking services in the country.
“The information provided on the CoinsTrades website, coinstrades.com, gives reasonable grounds to suspect that the company is conducting banking business and providing financial services in Germany without the required authorization,” BaFin stated. The authority reminded that authorization is required under the KWG to conduct banking business in Germany or provide financial services. The firm appears to be registered under the jurisdiction of St. Vincent and the Grenadines.
The watchdog, the German Federal Criminal Police Office (Bundeskriminalamt – BKA), and the German state criminal police offices (Landeskriminalämter) reminded investors to exercise caution when dealing with unauthorized websites as they might be at risk of losing their investments.
Recent Unrelated Investigations
In an unrelated case, BitcoinWelt’s activities in the country pursued by BitcoinWelt were under investigation by BaFin in September. The watchdog in Germany does not supervise bitcoinwelt.co, according to the warning. “Providers of banking or financial services in Germany require a permit under the KWG. However, some companies act without the required permission,” BaFin said. The website claims to offer forex and CFDs trading services as well and is available in English and German.
Last week, Mark Branson, the new Head of BaFin, stated that he would pursue an agenda to bolster supervision amid criticisms. BaFin’s reputation came under the spotlight after the collapse of Wirecard last year, which is a major Payments company. Branson used the phrase of giving ‘more bite’ to BaFin by referring to grant the watchdog more powers to make these efforts possible. Still, he praised the speed of the reforms. “But for me, this is only the beginning of BaFin’s long-term development. It will take time before we reach our objectives in all areas,” the BaFin President commented.
