Germany Taps Swiss Expert To Fix Broken Watchdog

Germany looks for outside help to deal with Wirecard's troubles.

In August, Mark Branson will officially take the helm of Bafin, the German finance watchdog. The British-turned-Swiss banker is once again called to the rescue to clean up and supervise a federal agency that has become too cozy with the financial institutions it regulates. Bafin failed to foresee the collapse of the payment company Wirecard.

Branson, 52, knows the banking industry inside out and has had international executive experience with UBS and Credit Suisse in Tokyo, London and Zurich. He is known for fighting money laundering and for his supervision of tax regularization. He also is uniquely qualified in rehabilitating failing financial watchdogs.

In 2014, Swiss banking regulator Finma was not in great shape. Swiss banks were being accused of manipulating currency markets and facilitating tax evasion. Branson, an alumnus of Cambridge University’s Trinity College and the University of Lancaster (and a Brit who later became a Swiss national), was brought in as CEO from a smaller position to be an independent outsider—and he was. Today, Marlene Amstad, the chair of Finma’s board of directors, credits Branson for his ability “to build up the authority nationally and internationally.”

After the German regulator failed to notice €1.9 billion missing from Wirecard’s accounts and ignored the fall of Greensilk Bank, Olaf Scholz, Germany’s finance minister, spent weeks trying to convince Branson to accept the presidency of Bafin. Scholz craves “supervision with a bite.”

Branson’s mandate at Bafin, ironed out with the blessing of the finance minister, is to build a task force of professional auditors and investigate potential fraud and money laundering throughout the system. He will even have the authority to search buildings and confiscate files. Economist Gerhard Schick, head of Finance Watch Deutschland, called it “a mammoth project” but one necessary to restore trust in the regulator.