Wirecard a massive criminal act: BaFin
GERMANY’S top financial regulator branded the accounting scandal at Wirecard a “massive criminal act” as the country’s authorities face a backlash over their failure to prevent the payments firm’s collapse.
Felix Hufeld, the president of BaFin, Germany’s top financial regulator, said: “It is plain vanilla, old-fashioned criminal behaviour.”
Wirecard filed for insolvency last week after revealing that €1.9bn (£1.7bn) of cash on its balance sheet probably does not exist.
Mr Hufeld’s allegations of criminality came a day after prosecutors and police raided Wirecard’s Munich headquarters and four other sites in Germany and Austria as part of the investigation of one of the biggest accounting scandals of the century.
Authorities in Singapore and the Philippines are also investigating the case.
Regulators, auditors and investors are facing scrutiny over their failure to question Wirecard’s management when the Financial Times published allegations of fraud at the company.
As a financial technology company Wirecard fell into a regulatory grey area in Germany. Mr Hufeld told the Bundestag’s finance committee on Wednesday that decisions about how to categorise Wirecard were made in conjunction with the Bundesbank and the European Central Bank. He previously called Wirecard’s demise “a complete disaster”.