Wirecard CEO Arrested, Announces Another Delay in Publishing Financials Due to Missing $2,1 Billion

Wirecard AG’s auditor Ernst & Young informed Wirecard that no sufficient audit evidence could be obtained so far of cash balances on trust accounts to be consolidated in the consolidated financial statements in the amount of EUR 1.9 billion (approximately a quarter of the consolidated balance sheet total). The date for publication of annual and consolidated financial statements 2019 has therefore been delayed.

There are indications that spurious balance confirmations had been provided in order to deceive auditors and create a wrong perception of the existence of such cash balances or the holding of the accounts for to the benefit of Wirecard group companies. The Wirecard management board is working intensively together with the auditor towards a clarification of the situation.

According to news reports the CEO has now been arrested by German authorities on suspicion of false accounting and market manipulation.

Wirecard has, through its purchase of MyGate in 2018 for R330 million, established a local presence in the South African market providing online payment services for companies including SANParks, Nelson Mandela and Rhodes Universities, Hirsch’s, Paul Mitchell and the City of Cape Town.