Wirecard scandal: ex-CEO leaves German deputies unsatisfied


The former boss of the company Wirecard, Markus Braun, before a parliamentary committee of inquiry in Berlin on November 19, 2020 (POOL / FABRIZIO BENSCH)

The former boss of Wirecard, expected for first explanations on the resounding bankruptcy of this company, refused Thursday to respond to German deputies responsible for hearing, reserving his statements to justice.

“I will not make any comments and I invoke my right to remain silent,” Markus Braun told the parliamentary commission of inquiry, before which he appeared, in Berlin.

This is the first time that Mr. Braun, incarcerated in a prison in southern Germany, has spoken in public since the revelation, before the summer, of the gigantic fraud of which Wirecard officials are accused.

In a short speech, he said he would speak “soon” to judicial investigators on this scandal at 1.9 billion euros which splashes the regulatory bodies and German politicians.

“At no time did I notice, or have information indicating that the authorities (…) did not behave in a correct way”, he simply added.

Dressed in his usual dark turtleneck à la Steve Job and his oval glasses, the 51-year-old Austrian then locked himself in silence and the hearing quickly ended.

Among the deputies annoyed by this behavior, the conservative Matthias Hauer (CDU) told the witness that he could not “act in this way with the Bundestag”, the lower house of Parliament.

Former Wirecard supervisory board member Tina Kleingarn, also auditioned, explained that she resigned from her mandate in 2017 because the company’s governance methods did not suit her.

The management board works “too autonomously” and sees the monitoring work of the company as “a burden”, she wrote in her resignation letter in September 2017 and of which AFP had a copy.

“Sooner or later these shortcomings will turn around” and the “risks taken (by the company) will materialize”, concludes his premonitory writing.

Mr Braun’s business partner Jan Marsalek, a former operations manager on whom there are serious suspicions of fraud, was absent for the day, having been on the run for months.

– Advanced technology –

The meteoric rise of Wirecard, specialist in online payments, has long been credited to Mr. Braun, the charismatic boss who created it in 1999. The company was worth more on the stock market than Deutsche Bank when it entered triumphant in 2018 in the Dax index in Frankfurt.

Despite doubts relayed by analysts and the press on an opaque model, Mr. Braun convinces by praising the technological advance of his company on the niche carrier of dematerialized payments.

The sky was clouding in 2019, when the Financial Times (FT) published a series of articles accusing Wirecard of massive fraud in Asia or the Gulf.

– This one billion –

After several postponements of the presentation of the 2019 accounts, the ax falls on June 18, 2020: the group admits that 1.9 billion euros in assets, or a quarter of the size of the balance sheet, do not actually exist.

The title will lose about 98% of its value as the public revelations on this scandal.

In debt for 3.2 billion euros, Wirecard was put into liquidation at the end of August.

The scandal turned into a spy novel when allegations about Jan Marsalek’s links with various intelligence services circulated in the media.

Creditors, bankers and investors can only expect to recover a tiny part of the sum via a sale by group apartments. The total of claims, which includes those of shareholders, reached a record sum of 12 billion euros.

The financial supervisory authority Bafin and the audit firm EY are criticized in this case, as the political world.

Members want to know if and when the federal government knew about the irregularities and if it did too little.

The committee would like to hear Chancellor Angela Merkel, who pleaded the Bavarian fintech cause before the Chinese authorities in September 2019, and the Minister of Finance, Olaf Scholz.



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