It is rare for individual Volksbanks to make national headlines. The VR-Bank Bad Salzungen Schmalkalden from Thuringia made it anyway – initially for harmless reasons. In 2018, Volksbank hired ex-national player Stefan Effenberg to accompany the bank on its foray into the glamorous football financing business. In the end, however, the company made a name for itself mainly because of shady business dealings; at times there were criminal investigations and an unusual power struggle with the financial regulator. Bafin has wanted to stop this activity for a long time. However, the bank management fought back accused the critics of envy on a supposedly successful business model.
But now the fight has been decided: After long-time boss Stefan Siebert had to leave, the entire 16-member supervisory board also resigned from their positions this week, including Thuringia’s former Prime Minister Dieter Althaus (CDU). Bafin has taken control, a fairly rare occurrence in the financial industry. A special representative takes on the tasks of both the Executive Board and the Supervisory Board.
They both have to clean up now. The bank is threatened with an enormous loss – especially because of dubious real estate transactions. We are talking about a three-digit million amount, which would be extremely high considering the reported equity of 155.6 million euros. The mirror recently quoted from an 81-page Bafin letter, which spoke, among other things, of concerns about the “reliability of money laundering prevention and the bank’s customer structure”, a “poor risk culture” and “questionable information and statements”. The investigative authorities are also likely to be interested in the events, say insiders.
Meanwhile, people on site are apparently taking refuge in the role of victim. It can be heard from those around the supervisory board that reports the Thuringian newspaper Free word, the members felt like they were being blackmailed by the Bafin and ultimately just wanted to “return the bank to calmer waters”. This will no longer happen: In order to protect customers’ savings deposits, the Volksbank will almost certainly have to go into the protection facility of the Federal Association of 737 Volksbanks and Raiffeisenbanks. After that, a neighboring Volksbank will probably take over the institute and end the “success story”.