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Chronology of manipulation: Wirecard balance sheet scandal: the deep fall of the former DAX hope | message

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• Prosecutors suspect fraud from 2015

• Ex-manager is on the run

• The 1.9 billion probably never existed

The story of the former DAX superstar Wirecard began in 1999 in Munich. After a series of mergers and cooperations, Wire Card AG was listed in 2004 by a reverse IPO in the Prime Standard of the German Stock Exchange. In 2006 the wire card was renamed Wirecard, and it was included in the TecDAX technology index.

September 24, 2018 – the DAX rise

Since the business of the payment service provider and the Wirecard shares have developed splendidly since their inclusion in the TecDAX, the company’s rise to the first German stock exchange league followed in September 2018. The inclusion in the DAX marked a real paradigm shift in the German financial industry for many experts at that time, as the aspiring payment company from Aschheim near Munich, with Commerzbank, was one of the largest German banks, which had held its place in the DAX family for decades had to take over.

At a time, the shares also marked their absolute all-time high with a price of over 190 euros. Between the inclusion in the technology index TecDAX in 2006 and the listing in the DAX in 2018, the Wirecard share gained up to 2,800 percent in value.

January 30, 2019 – the first doubts

In an online edition of the Financial Times, an anonymous report appears on the Wirecard, which reports to high-level managers of the group fraud and money laundering in Singapore. In this context, the source referred to an internal paper, which is said to have addressed these dubious business practices. As a result of this report, Wirecard shares plummeted by around 21 percent.

February 1, 2019 – the second shock

Just two days after the first critical publication, the London business magazine followed up and reported evidence that an external law firm found during an audit in Singapore that indicated serious balance sheet manipulation.

February 7, 2019 – the third Financial Times report

In a third report, the London business paper, Wirecard’s chief financial officer for Asia, accused the authorities of deliberate deception. According to the Financial Times, the senior manager is said to have provided up to six other colleagues with information on how to fake customer sales in order to obtain a business license from the Hong Kong authorities. In essence, the focus was on explicit profit targets, which the group was unable to achieve legally, according to the report.

February 8, 2019 – Raid in Singapore

Just a day after the third Financial Times report, the police in Singapore took action and ransacked the company’s offices in the Asian metropolis. Which exact results and materials the authorities were able to obtain and secure through the search remains unclear.

Between the January high and the February low in 2019, the share certificates fell from around 167 to 97 euros and thus lost a total of over 40 percent.

February 18, 2019 – BaFin’s ban on short selling

Due to the massive drop in the price of the Wirecard share, which took place within a very few trading days, the financial regulator BaFin imposed a two-month short sale ban on the DAX Group’s shares. With this step, the Federal Financial Supervisory Authority made a debut on the German stock exchange, since the Wirecard supervisory authority for the first time in its history pronounced a ban on short sales for a single company.

It is also known that the Munich public prosecutor’s office has launched an investigation against the Financial Times’ revelation journalist.

March 15, 2019 – Investigators target India business

According to the Handelsblatt, the investigative authorities from Singapore also examined Wirecard’s India business in mid-March. Similar to Singapore, the authorities investigated suspected money laundering and counterfeiting.

March 21, 2019 – The Financial Times follows

Another report by the Financial Times draws attention to the fact that Wirecard board member Jan Marsalek had known about the dubious transactions in Singapore, which are the focus of the allegations against the group, for some time.

March 26, 2019 – first attempts to explain

Wirecard publishes part of the results of its internal audit report, which was carried out by the Singapore-based law firm Rajah & Tann. As the report concludes that there may have been isolated crimes by local employees in Singapore, the stock rebounded strongly and climbed from around € 110 to over € 150 between late March and mid-May.

April 17, 2019 – BaFin takes effect

Due to the suspicion of market manipulation, BaFin reports to the Munich public prosecutor against almost a dozen participants. However, the Financial Times immediately rejected such accusations.

July 22, 2019 – Wirecard’s counterattack

In a letter, Wirecard asked the British newspaper to immediately stop reporting on the group. In addition, Wirecard threatened the Financial Times with the publication of irrefutable evidence disclosing collaboration between the newspaper and a hedge fund.

October 15, 2019 – Suspiciously high profits in Dubai

The Financial Times publishes another report that doubts the Group’s sales and profits in Dubai and Ireland. According to the newspaper’s research, in 2016, for example, around half of the group’s profits were generated through a Dubai-based partner company called Al Alam Solutions.

October 21, 2019 – Wirecard brings KPMG into play

In order to clarify the Londoner Zeitung’s allegations of accounting practices, the group decided to commission the KPMG auditing company to carry out an independent investigation into the allegations. The payment service provider hoped for a quick and uncomplicated processing of the numerous allegations.

December 9, 2019 – FT doubts about cash reserves

Another article in the Financial Times questions Wirecard’s reported cash reserves. According to the journalists, the payment service provider quickly added third-party funds, which were parked in various trust accounts, to its own cash reserves in its balance sheet for the 2017 financial year. As of this day, not only the group’s profit and sales were questioned, but also the cash flow statement.

April 28, 2020 – KPMG does not reach a clear result

The KPMG test report, which has been postponed several times, is published. Contrary to many expectations, however, the auditing firm cannot determine with certainty whether the level of sales in the financial years between 2016 and 2018 was intentionally manipulated. As a result of this disappointing result, the Wirecard share fell quickly from over 130 to below 90 euros.

May 8, 2020 – the last rescue attempt

The group announces extensive restructuring measures. The creation of a compliance department should create new trust among customers and shareholders.

May 26, 2020 – Annual General Meeting is postponed

Wirecard postpones the Annual General Meeting and the submission of the consolidated balance sheet. The reason for this is that the auditing firm Ernst & Young has not yet completed its certification.

June 5, 2020 – raid in Aschheim

The Munich public prosecutor searches the business premises of the headquarters in Aschheim near Munich. According to the public prosecutor, there is an urgent suspicion that responsible employees published misleading ad hoc notices in the period from March 12 and April 22, 2020, which should have driven the share price in a certain direction. During this period, the Wirecard share climbed from around 85 to around 140 euros.

June 18, 2020 – Ernst & Young’s death sentence

Instead of the longingly anticipated annual balance sheet, the auditing firm Ernst & Young delivers the final death sentence for the payment service provider. The experts have come to the conclusion that there is no evidence for the bank balances in the consolidated financial statements amounting to 1.9 billion euros. In addition, the auditors suspected that the group had misled certain balances.

This horror report caused the DAX Group’s share price to plummet from EUR 104 to temporarily below EUR 30. Wirecard thus lost up to 71 percent of its stock market value within a few hours.

June 19, 2020 – Braun abdicates

Markus Braun resigns as CEO and resigns with immediate effect. The position is taken over by US manager James Freis.

June 23, 2020 – Ex-CEO remains in freedom

After a payment of five million euros, the former CEO Markus Braun is temporarily released from custody.

June 25, 2020 – Filing for bankruptcy

Due to the threat of insolvency and over-indebtedness, Wirecard files a bankruptcy application with the Munich District Court.

June 26, 2020 – Wirecard shares hit all-time low

In the course of Xetra trading, the Wirecard share is still worth EUR 1.08 – the paper was thus reduced by more than 99 percent compared to the record high of summer 2019 at around EUR 190.

June 28, 2020 – District Court appoints insolvency administrator

The Munich District Court entrusts Michael Jaffe with the administration of the bankruptcy estate of the DAX Group.

July 13, 2020 – Politics are complicit

The Federal Ministry of Finance, headed by Olaf Scholz, is under increasing pressure. Some experts accuse the minister that he has been idle for too long.

July 20, 2020 – Ex-board member probably fled to Belarus

The former member of the board, Jan Marsalek, is believed to be in Belarus. Marsalek is said to have made his way to Belarus just a few hours after being released from custody.

July 22, 2020 – Prosecutor renewed warrants

The Munich public prosecutor’s office announces that it has again issued arrest warrants against Braun and other top managers of the group. The accused are accused of deliberately manipulating the group’s balance sheet since 2015.

July 29, 2020 – BaFin is threatened with fines

According to the financial regulator, Wirecard has breached its obligations with regard to the annual financial information for the 2019 financial year. Accordingly, the fulfillment of the financial reporting obligations was ordered and penalty payments of 330,000 euros were threatened.

July 31, 2020 – Customs and BaFin examine suspicion of money laundering

“The FIU and BaFin have agreed – within the scope of their respective responsibilities – on a task force to work together on the evaluation of the existing anti-money laundering information in the Wirecard case,” said the Federal Ministry of Finance.

Pierre Bonnet / Forex-news.com.net

More news about Wirecard AG

Image sources: Wirecard, Pavel Kapysh / Shutterstock.com



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