1996 523i BMW Transmission problem

Hi All; My brother owns a 1996 523i BMW, and lately he is having problems with the Trans. it works fine all the time, except when he decelerates where it gets
stuck on the 2nd gear, then makes a very bad noise when it goes further
down to the 1st gearwhile stopping, or while accelerating again from 0.
Any ideas? Personally, i do not think it is a mechanical problem, rather than an electrical one. Please advise.
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