List of Brokers with BaFin Regulation

BaFin's task is to limit risks to the German financial system both nationally and internationally while ensuring that Germany as a financial center continues to function properly and its integrity is maintained so that bank customers, insurance policyholders and investors can trust the German financial system.

FAQ

What does BaFin regulated mean?

Being regulated by BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht) or the Federal Financial Supervisory Authority means operating under the standards of a German financial regulator. Established in May 1, 2002, It is an independent institution under the supervision of the Federal Ministry of Finance. BaFin supervises thousands of banks, hundreds of insurance undertakings, and 800 financial services companies including forex brokerages in Germany.

What are BaFin rules?

• BaFIN regulated brokers need have at least two financial experts functioning as managers for the head of operations with no negative records or issues in relation to their roles in the company.
• Forex brokers under the regulation of BaFin are also required to hold an operating capital which starts from €750,000 to €5 million and beyond. The capital should be proportional to the amount of trading capital held on behalf of their clients.
• All client funds are to be held in segregated accounts at the top banks in Germany.
• Audit reports and financial statements should be submitted periodically to BaFin. They will be scrutinized by the agency to filter any discrepancies or modifications.
• BaFin regulated brokers need to ensure that they have the financial capacity to anticipate market fluctuations and an efficient insolvency procedure to prevents traders from losing their capital in case of inability to overcome the market volatility.
• All brokers should only act as an intermediary between traders and the market. Indulgence in any scams or malpractices that may endanger investors' security of their funds is strictly prohibited.

What is the main purpose of BaFin?

To prevent consumer violation in the financial industry, as well as protecting and regulating its members against financial anomalies. BaFin can also work together with its regulated brokers to ensure a good business environment for continued success in the industry. They are committed to the welfare of companies as well as investors, so their main purpose is to create a harmony between the two different forces in the market.

What are the powers of BaFin?

BaFin has designed guidelines in agreement with the MiFID derivative. They adopt Germany’s internal legislative powers to enforce a set of laws for their subjects.

BaFin is required to ensure the functioning of the German markets for securities and derivatives in accordance with the Securities Trading Act (WpHG). They can investigate every case of reported misconduct and penalize companies according to their involvement in the scam.

BaFin also allows consumers to initiate complaints and other reports concerning alleged violation of any regulated firm. BaFin encourages the companies and clients to reach an out-of-the-court settlement in the case of disputes. Should the problems need arbitration, it can either be referred to the Financial Ombudsman or the court.

If you are interested to open an account in one of the brokers in the list above, make sure to try the forex demo account before proceeding to register in the live account.