The FM 404 has (like the Grundig 2x4 super, No. 800/850/880) a 15-second time interval of the central processor. That means: After 15 seconds in "stop" position with no input from the control unit, the processor goes to "Standby", all motors stop and the breaking magnet will drop out - thats the noise, because without any cassette, both motors are turning fast.
With a tape loaded, the motors only transport the tape for a period of appr. 1-2 seconds, then the remaining time of the tape and the size of the cassette will be displayed (for example: "4-" and "0-.00" what means Cassette size VCC-480 (2x4 hours), remaining time 0:00 = Beginning of the tape).
After the 15 seconds, the display changes back to clock, if the clock is adjusted. If not, it changes to a blinking "88 8888".
In this 15 seconds, the tape is held in "stop" position only with the two reel motors, which have a identical torque depending to the position of the tape. After this 15 seconds, the reel motors get switched off and the magnet falls off.

If the tape drive does not thread in the tape, check the switches on the white plastic threading ring.

So far for the moment,
best regards,
stego

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A quick update on this... I cheked the metal plate in the plastic ring... It shows some kind of wear, but I checked it with the multimeter and definitely it makes the proper contact, that is, is conducting!