Wirecard cash

[dealmaker]

Wirecard cash

Shares in the controversial German fintech firm Wirecard continue to plummet after an E&Y audit showed it's missing $2.1 billion. The cash was supposedly being held by two banks in the Philippines, both of which say Wirecard actually isn't a client or depositor—one claims a "rogue employee" falsified documents. The company's stock price has fallen more than 70% since Wednesday's close, before the audit's results were announced. Bloomberg


ps behind pay wall

 

[unconventional wisdom]

really interesting story. curious how it plays out. hard to imagine a "we found the $2.1 billion"-ending. I'm tempted to trade this.

 

[JulioF]

The ~80% crash is funny.
Even more funny if that money never existed.

The stock will probably shoot up if things get sorted out as a dumb mistake.

Wirecard seems to have a huge structure and many clients unaffected, business as usual.

 

[maxinger]

I wonder which other companies in this world are doing similar thing and yet to be exposed.

 

[JulioF]

I wonder which other companies in this world are doing similar thing and yet to be exposed.

You are very much right.

It does not take much for auditors to close their eyes. And some times those who do not cooperate with the popular boys (banks) get burned. There is the probability that wirecard is being prepped for a takeover at a cheap price.

 

[virtusa]

Wirecard is filing for bankruptcy. Second man in charge is on the run. Probably hiding on Philipines.

 

[themickey]

Business Banking & finance Insolvency
Jan went missing after a multibillion-dollar scandal. Three years later, he has sent a sign of life
By Karin Matussek July 19, 2023

Former Wirecard AG chief operating officer Jan Marsalek contacted a Munich court through his lawyer, the first sign of life after the Austrian-born executive disappeared three years ago during the dramatic collapse of the German payments company.

The Munich district court received a letter written by Marsalek’s lawyer, a spokesperson for the institution said, declining to comment on details.

Former Wirecard chief operating officer Jan Marsalek contacted a Munich court through his lawyer, three years after disappearing.

Marsalek, 43, has been one of the key figures behind Wirecard’s spectacular rise to one of Germany’s most valuable companies before its implosion in June 2020, owing billions to creditors. At the time, Wirecard admitted that €1.9 billion ($3.1 billion) it had reported as assets probably never existed. Marsalek fled when the scandal broke and is believed to be hiding in Russia or Belarus. He’s on Interpol’s most wanted list and a Munich trial against him and other suspects continues.

WirtschaftsWoche first reported on the letter. Marsalek used the correspondence to reject claims that Wirecard’s third-party business didn’t exist and accused one of the key witnesses in the ongoing fraud trial of having lied several times, the German business weekly reports.

Marsalek’s actions at Wirecard have been a key subject at the Munich trial as Markus Braun, Wirecard’s former chief executive officer, and other defendants have sought to pin the blame on their one-time colleague.

At a hearing last year, Braun’s lawyer said the evidence suggests Marsalek and others set up an elaborate system to channel money out of Wirecard and into their own pockets, without Braun’s knowledge.

When Braun testified in February, he said that Marsalek was responsible for the unit that handled the so-called Third Party Agreements business that later became the centre of the corporate crisis. It involved payment processing handled by contractors in jurisdictions where Wirecard didn’t have a licence itself.

When the Financial Times in 2019 questioned the validity of the contracts and how they were booked at Wirecard, the company hired KPMG to look into the matter. Braun said he hoped the probe would end all questions.
While Marsalek initially argued against the step, he later supported the review, Braun said. But then in February 2020 he surprised him by telling him out of the blue that a few months earlier he’d changed the banks that held an escrow account for Wirecard, moving the money from Singapore to two banks in the Philippines, Braun told the court.

“I asked him whether he had lost his mind,” Braun said. But he told him that “this way we would lower the risk the funds could be frozen.”

Marsalek joined Wirecard in 2000 as an IT project manager and quickly built a reputation for programming, gaining the attention of Braun, a fellow native of Vienna. After Braun rose to the top job, Marsalek was tasked with keeping Wirecard’s global business humming — and expanding.

Wirecard’s failure marked the first time that a company listed on Germany’s benchmark DAX index went bust.Credit: AP

While Germany has had its share of accounting scandals and high-profile corporate collapses, few compare with Wirecard because the failure marked the first time that a company listed on Germany’s benchmark DAX index went bust.

Wirecard was long seen as Germany’s ticket to the world of digital payment systems as the world shopped, played and communicated online. When it all turned out to be built on sand, politicians and regulators faced tough questions how a sophisticated economy like Germany could have been so easily tricked, and why nobody followed up on early warnings.

Marsalek escaped from Austria to Belarus on a private aircraft in 2020, according to an Austrian warrant. Various news media reports have put him everywhere from Russia to a secret hideaway in Turkey to a tropical island.

Bloomberg