Wirecard AG: the missing EUR 1.9 billion and its aftermath

analysisWirecard AG, registered in Munich and a DAX 30 member from September 2018, reported a growing share of its revenue through three third-party acquiring partners, Al Alam, PayEasy and Senjo. In June 2020 its auditor EY could not confirm EUR 1.9 billion on trust accounts, the company said the balances probably did not exist, and it applied for insolvency. This edition follows the business from the special investigators' reconstruction of EY's files to the auditor oversight body's findings, ESMA's review of the supervisors, the insolvency estate and the criminal trial, keeping each party's response and the unresolved status of the charges beside every account. ^{1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22}

analysisWirecard AG is a German stock corporation registered with the Munich local court under HRB 169227 since 6 August 2007. According to its 2019 bond prospectus it was incorporated in Berlin on 6 May 1999 and moved its seat after a shareholders' resolution of 14 June 2007; its earlier names were InfoGenie Europe AG and Wire Card AG. In 2006 Wirecard bought XCOM and renamed it Wirecard Bank, obtaining Visa and Mastercard licences; the bank held a full German banking licence under BaFin's supervision. ESMA describes Wirecard AG as a fintech company included in the DAX 30 from September 2018 and notes that allegations of accounting irregularities raised several times during its rapid growth were systematically rejected by the company. ^{1 2 3 4 5 6 7}

analysisThe special investigators appointed by the Bundestag's committee of inquiry describe two business models: Wirecard's own business, running the whole payment chain with Wirecard Bank as acquirer, and third-party acquiring, in which payment processing and the acquiring bank's services were outsourced to three partners, Al Alam, PayEasy and Senjo, which alone held contracts with the merchants. Their table of key figures from the accounts and EY's working papers shows TPA revenue rising from EUR 308 million in 2014 to EUR 1,034 million in 2018, against group revenue of EUR 2,016 million that year, and escrow balances counted as cash rising from EUR 114 million (2015) to EUR 976 million (2018). ¹

analysisFinancial Times articles of 2019, as summarised by ESMA, reported that half of Wirecard's revenue and almost all its profit came from three opaque partners and that profits were channelled mainly through CardSystems Middle East in Dubai; later reports said that payments for clients routed through Al Alam included companies that had never heard of it and that EUR 334 million on trust accounts in 2017 had been wrongly classified as cash. Wirecard rejected such allegations at the time. On 22 June 2020 it stated that the trust account balances of EUR 1.9 billion probably did not exist. ^{2 3}

analysisOn 18 June 2020 Wirecard announced that EY could not obtain sufficient audit evidence for EUR 1.9 billion on trust accounts, about a quarter of the balance sheet total, that there were indications of false balance confirmations presented to deceive the auditor, and that the 2019 accounts were postponed. Four days later it said there was a prevailing likelihood that the balances did not exist, and ESMA records that the company filed for insolvency a week later. According to press reports, the governor of the Philippine central bank said the money had not entered the Philippine financial system and that the names of BDO Unibank and Bank of the Philippine Islands had been used to cover the perpetrators' tracks; both banks said Wirecard was not their client. A European Parliament briefing notes that the key question of KPMG's special audit was whether EUR 1.9 billion supposedly held in an escrow account at OCBC Bank in Singapore existed, and that the report did not clarify all questions; according to a later press report, OCBC told the insolvency administrator that it had never held significant sums for the trustee and that some accounts had never existed. ^{1 2 3 4 5}

analysisEY gave unqualified opinions on Wirecard's accounts for every year from 2009 to 2018, as the Finance Ministry reported to the Bundestag. On 31 March 2023 Germany's auditor oversight body APAS found breaches of professional duties in the 2016–2018 audits of Wirecard AG and Wirecard Bank AG, fined the audit firm EUR 500,000 and barred it for two years from new statutory audits of public-interest entities; its announcement does not name the firm, which for those years was EY. ESMA's peer review of November 2020 found a heightened risk of Finance Ministry influence on BaFin, trading in Wirecard shares by some staff of BaFin's market-abuse team, and that the enforcement panel FREP did not select the 2015–2017 accounts for examination nor did BaFin request it. ^{1 2 3}

analysisWirecard AG applied to open insolvency proceedings on 25 June 2020, and the Munich insolvency court appointed Dr. Michael Jaffé as preliminary administrator. The European technology platform was sold to the Santander group, closing on 28 January 2021; North America, Brazil and Romania had already been sold. According to the Federal Court of Justice, about 50,000 shareholders filed claims of about EUR 8.5 billion, and claims in total of about EUR 15.4 billion face an estate of about EUR 650 million. ^{1 2 3 4 5}

analysisOn 10 March 2022 the Munich I prosecutor charged the former chief executive, the former head of accounting and the former managing director of the Dubai subsidiary CardSystems Middle East, later named in the press as Markus Braun, Stephan von Erffa and Oliver Bellenhaus; the indictment states the prosecution's case, which the court has to establish. The trial began on 8 December 2022 and hearing dates have been set up to 23 December 2026, with no judgment by the cutoff. According to a press report of September 2026, the presiding judge said there were no indications that the TPA business existed and called Braun's account that its proceeds were embezzled by Marsalek's circle untenable speculation. The statements are not a judgment, the defendants are presumed innocent until a final verdict, and Braun maintains his account. ^{1 2 3 4}

analysisJan Marsalek is under investigation for professional gang fraud, aggravated breach of trust and other offences, and the Federal Criminal Police Office has issued a public appeal for his arrest; he has not been tried. In sentencing remarks of 12 May 2025 in a London case of conspiracy to spy for Russia, the judge recorded the prosecution's case that the agent using the alias "Rupert Ticz" was Marsalek; the main defendant's plea did not accept the identification but agreed it did not matter. ^{5 6}