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Wirecard collapse leads to call for German parliamentary inquiry

Christian Fernsby ▼ | June 29, 2020
Germany’s opposition called on Monday for a parliamentary inquiry into the collapse of payments firm Wirecard after a global fraud that left a gaping hole in its books went undiscovered by auditors and regulators for years.
Wirecard
Inquiry   Wirecard
FREP President Edgar Ernst told the Frankfurter Allgemeine newspaper that only one employee had been tasked with looking into Wirecard after BaFin asked it to check the company’s accounts for the first half of 2018.

Topics: Wirecard German

The FREP assessment had yet to be finalised by the time Wirecard collapsed.

Liberal member of parliament Frank Schaeffler, who also sits on Bafin’s supervisory board, asked for the parliamentary inquiry and said he believed there were both structural and personnel shortcomings at the financial regulator.

The request for an inquiry came after Germany said it would cancel its contract with the country’s privately-run accounting watchdog FREP as a result of a scandal that financial regulator BaFin has branded a “total disaster”.

Wirecard filed for insolvency on Thursday owing creditors almost $4 billion after disclosing a 1.9 billion euro ($2.1 billion) hole in its accounts that its auditor EY said was the result of a sophisticated global fraud.

EY said it had confirmed with officials at Philippine banks BPI and BDO which have been named as Wirecard partners that EY received false bank confirmations and statements for Wirecard escrow accounts.


 

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