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Wirecard back in the wars over accounting allegations

Wirecard back in the wars over accounting allegations

Wirecard shares have taken another kicking on the stockmarket following a new report in the Financial Times that two executives in Munich knew of alleged accounting fraud in the firm's Asian operations.

Two officials in the Munich head office were aware of a "round-tripping" scheme in Singapore that may have been part of a pattern of book-padding across the company’s Asian operations, the Financial Times reported Thursday.

The firm is fighting a frantic rearguard action to quash reports of alleged wrongdoings, flatly stating "nothing about the article published today is true".

Wirecard has confirmed prior concerns raised by a whistleblower about alleged financial improprieties within the company's finance team in Singapore.

The allegations related to potential compliance breaches in the area of accounting for the period 2015-2018 totaling revenues of EUR6.9m and costs of EUR4.1m as well as an internal transfer of software intellectual property valued at EUR2.6m.

The firm appointed external auditors from Singaporean compliance law firm Rajah & Tann to investigate the allegations. While the FT claims that Rajah & Tann identified potential civil and criminal violations in Singapore, Hong Kong, India, Malaysia and Germany, Wirecard maintains that the law firm has yet to make any conclusive finding of criminal misconduct.

Wirecard shares slipped a further 12% on the back of today's allegations.

In a statement issued Friday, Wirecard confirms that it is actively co-operating with Singapore law enforcement in an attempt to clear its name.

"We actively approached the authorities yesterday and pledged our full cooperation in the investigation activities. After such negative media coverage, the initiation of an investigation is a normal procedure. We maintain that we will properly complete our internal compliance investigations and disclose these findings to the public. This morning, Wirecard met with Singapore law enforcement at Wirecard's headquarter in Singapore and provided the police with comprehensive supporting material in regards to their enquiry into the defamatory allegations in the FT series of articles. We would like to reconfirm that the accusations against employees of Wirecard are unfounded. We are working closely with the Singapore police to clear all allegations."

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A Finextra member
A Finextra member 07 February, 2019, 17:45Be the first to give this comment the thumbs up 0 likes