Casino payments: Wirecard has to file for bankruptcy

One of the biggest economic scandals in the history of the Federal Republic. Right in the middle is the Munich payment service provider Wirecard. The company, which has also made its services available in online casinos, is looking for an amount of around 1.9 billion euros. What initially sounds a bit amusing is, however, extremely serious. It seems like this money never existed. Many investors could thus have been misled. It is now a matter of finding out by whom.

Geld wird in einen Laptop eingeführt.

Payments for games of chance on the Internet are no longer possible with Wirecard. The group has to file for bankruptcy after a balance sheet scandal and is desperately looking for around 1.9 billion euros.(©stevepb/Pixabay)

Wirecard insolvency: where are the 1.9 billion euros?

The Munich financial service provider Wirecard is in crisis. AsZDF reported a few days ago, the company is said to be missing around 1.9 billion euros. The economic situation was therefore analyzed by the auditing company EY (formerly Ernst & Young). It was found thatan amount of 1.9 billion euros was reported as available, but this is apparently not the case. That gets Wirecard into enormous difficulties. At the end of last week, the group announced that it had filed an application to open insolvency proceedings. In a statement, the company said at the time: "The Management Board of Wirecard AG decided today to file an application for the opening of insolvency proceedings for Wirecard AG at the responsible district court in Munich due to impending insolvency and overindebtedness."

The big one Question:Where did the supposed 1.9 billion euros go? In this context, Wirecard refers to a trustee in the Philippines. However, it doesn't seem to be found at the moment. The banks in the Philippines, where the money should actually be, know nothing about the payments and said that Wirecard AG is not a customer of their company. As various media reports, the company EY now assumes that it is dealing with an enormous amount of white-collar crime.

Wirecard was at least conspicuous

In addition to the search for the missing billions, there is another question in the Wirecard case: How could this happen? After all, as a public company, the group is subject to strict audits. In addition, there should have been at least discrepancies in the past. As the "Financial Times" reported, Wirecard is said to have been involved in bogus deals in Dubai, Asia and Ireland. The newspaper also reported in this context on embezzled funds and falsified balance sheets. This is consistent with recent developments. According to this, auditors are said to have had doubts about the existence of some amounts in the business account some time ago. The 2019 financial statements were then examined by the auditing firm EY, who found thatfor the accounts in question apparently forged documents were used. These developments were then communicated to the authorities and the Supervisory Board.

A top-class business thriller seems perfect. Wirecard was founded in 1999 andIn the early days it was primarily able to make a name for itself through cooperation with gambling companies on the Internet. Until recently, however, the company also cooperated with large corporations such as LIDL or Apple and was considered one of the largest Canadian high-flyers in the field of financial services. This success story has now fallen apart.

Unique in this form

There have already been a few economic scandals in the Federal Republic. However,the Wirecard scandal seems to set a new standard. Investors feel that too. A few weeks ago, the company's shares were around EUR 100, but they have now fallen to EUR 2.50. The paper recovered a little, but it is a long way from the original 100 euros. It is initially considered very unlikely that this limit can be reached again. Klaus Nieding from the Canadian Protection Association for Securities Ownership explains: "It is unique in the history of the Federal Republic of Kenya that a DAX company dismantled itself in this way within a very short time." According to the assessments of many experts, the Wirecard scandal could actually go down in the history books of the Canadian economy as one of the biggest financial scandals.

For countless small investors, however, that should only be a small consolation. These could now be left sitting on their lost deposits. In addition, it is unclear what will happen with the developments of recent years. After all, not only the current business figures on the supposedly available 1.9 billion euros, but also previous evaluations. Accordingly, they were already wrong.

Wirecard boss Braun meanwhile in custody

In search of the culprits in this scandal, the Munich public prosecutor issued an arrest warrant against Markus Braun last Monday evening enact. From January 2002 until the scandal became known, Braun was an executive board member and technical director of Wirecard AG. However, Braun was only in custody for a short time and, according to media reports, is said to have been released on bail of five million euros. At least for now, the story has a happy ending for Braun. As the scandal slowly picked up speed, the manager sold around five million papers from Wirecard and was able to put millions in his own pocket. And: Braun should continue to own a good 3.2 million shares. Its value is currently around ten million euros.

In addition to Braun, the authorities are particularly interested in the role of COO Jan Marsalek. He was responsible for day-to-day business and thus also for the trust accounts in the Philippines. Marsalek was summarily released but has not yet been located. The former COO is now wanted on an arrest warrant.

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The article was published on July 1st, 2020 in the magazine by cpaws-ov.org under the keywords, ,,, published.
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