BaFin prohibits BalticPay Corporation, domiciled in Latvia, from providing unauthorised money-remittance business in Germany

Bonn/Frankfurt a. M., 26 October 2015

By order of 28 September 2015, the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) prohibited BalticPay Corporation, domiciled in Riga, Latvia, from providing any further money-remittance business in Germany.

BalticPay Corporation provided unauthorised payment services in Germany by accepting funds via direct debit or credit transfer for the benefit of third-party payees into its own accounts in Germany and transmitting them to its accounts in Latvia. The partners in BalticPay Corporation were Thomas Lennert and Jens Leinert.

By accepting these funds into German bank accounts, BalticPay Corporation provided money-remittance business within the meaning of section 1 (2) no. 6 of the German Payment Services Supervision Act (Zahlungsdiensteaufsichtsgesetz – ZAG) without having the authorisation required under section 8 (1) sentence 1 of the ZAG. BalticPay Corporation was also not authorised to provide payment services in Germany under the freedom to provide cross-border services pursuant to section 26 (1) of the ZAG. BalticPay Corporation is not authorised to provide cross-border services in Latvia by the supervisory authority there, the Financial and Capital Market Commission (FKTK).
Therefore, in accordance with section 4 (1) sentence 1 of the ZAG, BaFin has ordered BalticPay Corporation to immediately discontinue these business operations.

Pursuant to section 23 of the ZAG, the order is immediately enforceable but not yet final.