Dunno much about the 7 series, but all cars need to be able to test the warning lights. This test is normally performed when you turn the key to run without the car's motor running yet.

Some of the warning functions are switches (such as the one on your handbrake) which complete a circuit to light the lamp, so a way to test the light has to preclude you pulling up the brake handle. The alternator, when not turning, provides just what they need - a switch to ground in effect. A diode is used to be sure to allow these warning lamps to light individually when their real warning condition exists.

So, what you saw is commonly expressed as "the car stalled and the instrument panel lit up like a Christmas tree," but in your case the car did not need to stall. Just surprised you to find that alternator belt shredded. Nice 'n' easy to replace on a 740?
--
Art Benstein near Baltimore

When my friends get sick of my pun collection, they send me new ones:
I did a theatrical performance about puns. It was a play on words.