Fatih Köylüoglu
Senior Manager, Financial Services Insurance
Because Rules Ensure Reliability and Quality
On 1 January 2013, new professional rules have been established for financial investment brokers. Since then, they have been required to obtain a license in accordance with Section 34f of the German Trade Regulation Act (Gewerbeordnung, GewO). The licensing requirement is designed to protect investors from unqualified advice and improper brokerage of financial investments by ensuring that unsuitable persons are prevented from acting as financial investment brokers.
Legal Framework
Licensed financial investment brokers pursuant to Section 34f GewO and fee-based financial investment advisors with a license pursuant to Section 34h GewO are required to have a suitable auditor verify their compliance with the provisions of the German Financial Investment Brokerage Ordinance (Verordnung über die Finanzanlagenvermittlung, FinVermV) for each calendar year. The audit report must be submitted to the competent authority no later than 31st December of the following year. The audit report is a key instrument used by the supervisory authority to monitor ongoing compliance with reporting obligations and, consequently, the proper conduct of brokers under Section 34f and advisors under Section 34h. There are no de minimis thresholds or discretionary limits. An annual review is mandatory if investment advice or brokerage services are provided in the calendar year, regardless of whether commissions have been received. In this case, it is no longer possible to submit a negative declaration.
Our Services
BDO serves as a suitable auditor for individual case and system audits of financial investment brokers, sales companies and broker pools of all types and sizes. Our experts conduct audits in accordance with Section 24 of the FinVermV using quality-assured checklists, modern IT-supported auditing tools, and documentation standards. This approach ensures that we provide you with the most efficient and cost-effective audit possible, maintaining the highest quality, so you can fully concentrate on your core business. Additionally, we equip your audit reports with a qualified electronic signature, enabling you to conveniently and directly forward them to your supervising licensing authority via email or alternatively upload them to the website. Furthermore, we have found that our audit reports are accepted by all licensing authorities in Germany without any further inquiries.
We are happy to support you with
- Individual audits of financial investment brokers / sales companies / broker pools in accordance with Section 24, Paragraph 1, Sentence 1 FinVermV
- System audits of sales companies in accordance with Section 24, Paragraph 1, Sentence 4 FinVermV
- Audits of the holistic implementation of regulatory requirements (internal audit)
- Adaptation of sample forms (e.g. advisory protocol / declaration of suitability)
Our 360° Approach
Our team of experts will be happy to help you overcome the diverse challenges of today and tomorrow and solve complex tasks efficiently. With our knowledge and many years of experience, we provide you with comprehensive advice and offer holistic services for all your needs — from strategic advice and process optimization to innovative solutions for digitalization, cybersecurity as well as auditing, and tax advice. We work closely with other financial services specialists and insurance experts from other German-speaking countries and leverage the global BDO network across sectors and borders.