When British short seller Matthew Earl called the whistleblower hotline of Germany’s financial watchdog BaFin in late 2016 to flag suspicious activities at German payments company Wirecard, he did not get far.
After he mentioned the company’s name, Earl said the friendly person at the other end asked him to call back at a later point, claiming their English wasn’t good enough. On the second attempt, BaFin hung up on him after he had said he was calling about Wirecard. For his co-authorship of an anonymous report into suspected accounting fraud and money laundering at Wirecard, Earl even became a target of an unfounded criminal investigation by prosecutors.
Such experiences have been typical for whistleblowers in Germany: there has been a long-standing distrust in the country of individuals who highlight other people’s wrongdoings to authorities. This view is partly rooted in German history: both the Nazis and the communists in the German Democratic Republic urged and incentivised citizens to report suspicious behaviour.
And whistleblowers have long enjoyed very little if any legal protection. For decades, even employees who flagged criminally relevant behaviour by their employers to police could be fired legally. Courts argued that whistleblowers behaved disloyally and violated their duty of allegiance to the employer. In a landmark ruling in 2011, the European Court of Human Rights struck down this view.
While BaFin reorganised and beefed up its whistleblower office...
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