Wirecard before deforestation: Hundreds of employees are laid off - the remainder of the board must also leave

The Munich District Court has opened insolvency proceedings for the insolvent payment service provider Wirecard. Many employees are now finally facing the end.

• The insolvent payment service provider Wirecard flew out of the Dax on Friday.
• The Munich District Court has now opened insolvency proceedings.
• For many employees is now finally concluded .

Update August 25, 4:40 p.m. - Every second employee has to leave at the insolvent payment service provider Wirecard . Around 730 of the last around 1,300 jobs would be deleted, said insolvency administrator Michael Jaffé on Tuesday afternoon. The two remaining Wirecard board members Alexander von Knoop and Susanne Steidl also have to leave. The company thus confirmed a corresponding report from Merkur.de *.

The economic situation of Wirecard AG is "extremely difficult in view of the lack of liquidity and the well-known scandalous accompanying circumstances," said Jaffé as a reason. "The usual restructuring and cost adjustment measures are therefore not enough."

The Munich District Court had insolvency proceedings on Tuesday Wirecard AG opened and six other subsidiaries and the lawyer Michael Jaffé appointed liquidator.

With this step, Wirecard has to pay the personnel costs for the remaining 570 employees itself. After Wirecard filed for bankruptcy at the Munich District Court at the end of June, the employment agency initially took over the wages and salaries.

Insolvency proceedings opened for assets of Wirecard AG - Dr. jur. Michael Jaffé as insolvency administrator ... https://t.co/T4wgk86NW9

With the appointment as insolvency administrator, Jaffé now has full right of intervention. This applies above all to the recycling of the valuable components of the company from Aschheim near Munich. It was only on Friday that Jaffé reported an initial exploitation success with the sale of the Brazil business. According to industry circles, the price for Wirecard Brazil should have been in the mid double-digit million range.

Update August 25, 2:55 p.m. - The Munich district court opened the insolvency proceedings for the insolvent payment service provider Wirecard on Tuesday. The court appointed the provisional insolvency administrator Michael Jaffé as the insolvency administrator .

In order to enable the continuation of the business, the lawyer has announced drastic staff cuts. A total of 730 positions of the last around 1300 jobs are to be deleted, Jaffé announced on Tuesday afternoon. The economic situation of Wirecard AG was "extremely difficult in view of the lack of liquidity and the well-known scandalous accompanying circumstances," said Jaffé in support of the reason (more shortly).

Wirecard: First subsidiary sold

Update August 21, 1:38 p.m. - With the insolvent payment service provider Wirecard , the provisional insolvency administrator Michael Jaffé has achieved an initial commercial success . The Brazilian subsidiary Wirecard Brazilgo to a subsidiary of the Brazilian payment service provider PagSeguro Digital, announced the provisional insolvency administrator Michael Jaffé on Friday afternoon. The conclusion is still subject to the approval of the supervisory authorities. From industry circles it is said that the purchase price is in the "mid double-digit million amount".

The sale of Wirecard Brazil is all the more gratifying as the general conditions in the Wirecard insolvency proceedings are "extremely difficult", said the experienced insolvency administrator. The sales process at the US subsidiary Wirecard North America was "already well advanced," it said.

The provisional insolvency administrator also sees himself on track with the intended sale of the company's core business from Aschheim near Munich. There are "several well-known interested parties who have submitted indicative offers," said Jaffé.

Update 8/20/2020, 11:17 a.m. - At the insolvent payment service provider Wirecard * , the employees want to set up a works council. On Thursday (20.8.2020) the employees of the first three subsidiaries at the group headquarters in Aschheim near Munich elected the electoral board.

The electoral board prepares the actual works council elections. In addition to searching for candidates, his most important tasks include drawing up the election list and organizing the actual works council election.

At the beginning, the total of around 600 employees of the two software subsidiaries Wirecard Acceptance Technologies GmbH and Wirecard Service Technologies GmbH as well as Wirecard Bank AG not affected by the insolvency determined the three-member electoral board. Next Tuesday (August 25th) the employees of Wirecard Global Sales GmbH, Wirecard Technologies GmbH and Wirecard Iussing Technologies GmbH will elect their electoral boards. The parent company Wirecard AG follows on August 28th.

🌟Why a #works council is a really good idea? We have briefly summarized it for you.
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Wirecard: Works council with a say in key issues

The future councils have in key questions an important voice, explained Verdi -Gewerkschaftssekretär Kevin Voss , theaccompanied the establishment of the works council at Wirecard , opposite Merkur.de *. This applies, for example, in the event of possible company closings and negotiations about possible social plans or questions about protection against dismissal. After all, the insolvent company is now threatened with a job cut. In addition, many highly qualified Wirecard employees have a residence permit as part of a Blue Card. This would also be eliminated with the loss of the job.

The provisional insolvency administrator Michael Jaffé is currently examining whether the remaining assets at Wirecard justify opening insolvency proceedings. According to information from Merkur.de *, the corresponding report should be available at the Munich District Court by the end of August (Merkur.de * reported). Informed circles say that Jaffé will “in all probability” recommend the opening of insolvency proceedings in his report. The courts usually follow the recommendations in the insolvency report.

He contacted Merkel advisors: After Guttenberg - next politician in Wirecard problems?

Update from August 13, 7.45 p.m.: In the Wirecard scandal, more and more (ex) top politicians are doing extremely badly - now a former head of the country is hit: Even the former First Mayor of Hamburg, Ole von Beust, stood up for this at the Federal Chancellery Company, as can be seen from the Federal Government's responses to questions from the Green parliamentary group, which were submitted to the AFP news agency on Thursday. Accordingly, von Beust turned to the economic advisor to Federal Chancellor Angela Merkel (CDU), Lars-Hendrik Röller, in March of this year.

The former top politician therefore acted in his capacity as a member of von Beust and Coll. Consulting company. He wrote to Röller on behalf of Wirecard and asked "for further information on the EU-China summit planned under the German EU Council Presidency in Leipzig (including a possible accompanying program for companies)".

According to the information provided by the German government, Röller replied a good week later that the preparatory work for the summit was with the President of the European Council, Charles Michel. So far, there are no concrete plans to involve companies. The EU-China summit has since been canceled due to the corona pandemic.

The consulting company from Beust & Coll. confirmed the commitment for Wirecard to Der Spiegel : "We worked for Wirecard AG from June 1, 2018 to July 13, 2020," said a spokesman for the magazine. “The business relationship was terminated by us.” Wirecard filed for bankruptcy on June 26th against the backdrop of a billion-dollar accounting fraud scandal, and the preliminary insolvency proceedings are now about to be concluded.

A few weeks ago it became known that the former secret service coordinator Klaus-Dieter Fritsche had advertised the company in the Chancellery last year. The former Federal Defense Minister Karl-Theodor zu Guttenberg had also campaigned for Wirecard at the government headquarters.

Wirecard: Where is ex-manager Jan Marsalek? BKA is now asking for information from "Aktenzeichen XY"

Update from August 12, 8:58 p.m.: It has something of a Hollywood thriller - only this story is true. The former Wirecard manager Jan Marsalek is now being searched internationally: the Munich police and public prosecutor's office , BKA , Interpol - the list of authorities is getting longer and longer.

On Wednesday evening, the Federal Criminal Police Office only published a wanted poster for the Austrian on the ZDF program “Aktenzeichen XY ... ungelöst” . "Commercial gang fraud in the billions" is the crime that is said of the ex-manager. He is currently on the run. Two pictures are now being searched for him. One shows the main suspect in the Wirecard accounting forgery scandal with a full beard, on the second To see him shaved without a beard.

With these reports, the Munich police, the BKA and Interpol are looking for ex-Wirecard manager Jan Marsalek

© Screenshots Police Munich / BKA / Interpol

The payment service provider from Aschheim near Munich had to file for bankruptcy at the end of June after 1.9 billion euros had vanished into thin air. The ex- Wirecard managers are said to have artificially inflated the balance sheet in order to be financially strong and attractive for investors and customers.

Update from August 10, 4:15 p.m. - The insolvent payment service provider Wirecard has long been considered a model company in the Dax. But at the latest since 1.9 billion euros of equity disappeared overnight in the spring, the company is only considered an eyesore in the Dax. This week, Wirecard is likely to fly upright out of the most important German stock market barometer.

September 6, 2018 was a tough day for Commerzbank employees and their shareholders. On this late summer day, the traditional credit institution had to remove it from the German Share Index (Dax). The payment service provider Wirecard took over the place of the second largest German private bank. Many observers thought that was really cool: Finally a touch of Silicon Valley in the otherwise dusty German stock market barometer, they said.

Wirecard: an abyss of treason

Barely a year and a half, the former shooting star from the Dax is broke. And instead of high-tech Made in Germany, the high-flyer from the Munich suburb of Aschheim now turns out to be just an abyss of treason.

This week the biggest misunderstanding in the history of the German stock market barometer could finally come to an end. Deutsche Börse plans to publish the results of an opinion poll among market participants by August 13th at the latest. In essence, the survey among professionals was about the question of whether the index rules should be adjusted so that in future an insolvent company can be kicked out of the Dax beyond the regular review dates. You don't have to be able to operate a crystal ball to predict the answer.

After all, the Wirecard case has probably damaged Germany as a stock exchange location more than the scandal surrounding invented horizontal drilling machines at Flowtext and the billion-dollar bankruptcy of HRE put together.

Wirecard: The possible DAX successors

If investors and Deutsche Börse get their thumbs down over the course of the week, things should go very quickly for Wirecard. The former stock market high flyer is due to fly out of the Dax in August and thus much earlier than previously thought. The current regulations of Deutsche Börse would not have provided for a descent until the next regular examination date on September 21 - unless the opening of insolvency proceedings was rejected due to insufficient funds. There is little evidence of this at Wirecard at the moment. Deutsche Börse has therefore tightened its regulations and obtained feedback from investors.

I also don't know whether it's so great to be a direct successor to Wirecard's heap of rubble.

The delivery service Delivery Hero and Symrise are considered possible successors from Wirecard . But at least the boss of the flavor manufacturer from Holzminden is not that keen on the Dax. “I don't know either,” said Symrise boss Heinz-Jürgen Bertram when the quarterly figures were presented on August 6, “whether it's so great to be a direct successor to the heap of rubble Wirecard.

Wirecard: Around 870 million disappeared - companies "looted" shortly before bankruptcy

Munich - With the insolvent payment service provider Wirecard , around 870 million euros are said to have disappeared in dark channels shortly before the bankruptcy in June . The company was literally "looted", reports the Financial Times on its website. 

According to the report, the money is said to have flowed out through loans to Wirecard partner companies in Dubai , Singapore and the Philippines, writes the FT. The English business newspaper had started the investigation against Wirecard with its persistent reporting.

Wirecard: Is there a connection between the missing 1.9 billion and the loans?

The payment service provider from Aschheim near Munich had to file for bankruptcy at the end of June after 1.9 billion euros had vanished into thin air. Observers speculate that the air bookings may be related to the generous loans to the group subsidiaries.

According to initial estimates, the financial damage to the company listed in the German flagship index Dax should be around 3.5 billion euros. In addition, there are billions in losses for investors.

Meanwhile, the Munich I public prosecutor's office is investigating Wirecard and several managers on suspicion of falsification of accounts, breach of trust, price manipulation and joint gang fraud. Several former Wirecard employees are now in prison, including ex-Wirecard boss Markus Braun , the former CFO Burkhard Ley and the former chief accountant behind bars.

Wirecard: Dubious million-euro loans to subsidiaries

According to FT, the dubious payments to subsidiaries played a central role in the investigations of the prosecutors. According to this, a total of around 155 million euros had been paid out in the first three months of 2020 alone. According to FT, the majority of the loans went to Ocap . The Singapore- based company alone received additional loans of more than 100 million euros. With this, Ocap was in the chalk at Wirecard with a total of 230 million euros.

Another 40 million euros went to the Singapore-based company Ruprecht Services . At the end of March, Wirecard is said to have issued loans with a total volume of around 870 million euros to subsidiaries in Asia, writes the FT.

Wirecard: Al-Alam in Dubai is again playing a questionable role

Further funds are said to have been transferred to Al-Alam in Dubai and Pay Easy in Manila, among others . According to Wirecard, Al-Alam was Aschheim's most important third-party partner for years. A good third of the business and almost half of the profit were processed through the third party in Dubai , it said.

However, not least because of the FT's reporting, doubts about this presentation had grown considerably. In order to dispel the reservations, Wirecard finally gave in to the growing public pressure and commissioned a special audit by the auditing company KPMG . Al-Alam suddenly stopped operating in mid-May. The damage to the reputation was too great, a Wirecard spokeswoman justified the surprising step.

Wirecard: millions of loans in front of the special auditors from KPMG

According to the FT, the loans are said to have been granted even after KPMG had already been commissioned with a special audit and was also supposed to scrutinize Al-Alam's business. 

Wirecard scandal: Now the sell-off begins - the most popular parts of the company

First report from July 27, 2020: Munich - In the scandal surrounding the insolvent payment service provider Wirecard , the provisional insolvency administrator Michael Jaffé is apparently making good progress. For a possible takeover of Wirecard's US business alone, there is now a "double-digit number of interested parties," according to informed sources. In addition, the first indicative offers have been made for the US subsidiary Wirecard North America . Further offers are likely to arrive in the coming days, said a person familiar with the processes to the central editorial office of Ippen Digital. 

Wirecard break-up: Greatest interest in core business

However, the greatest interest continues to be seen in a possible takeover of Wirecard's core business. It is said that there is “strong interest” in this from both financial and strategic investors .

Wirecard grew up with what is known as acquiring and issuing . With acquiring, Wirecard takes on the billing of credit card transactions at the checkout terminal in the supermarket or payment in the online shop. The issuing business includes the issue of prepaid or debit cards, which are loaded with money or - depending on the agreement - debited immediately with the purchase or later.

In addition, customers can process all of their payment transactions through the issuer. In the case of the company from Aschheim near Munich, it was Wirecard Bank .

Wirecard: The sales process is in full swing

Potential buyers for parts of the insolvent DAX group can obtain information after registering in virtual data rooms and carry out the so-called due diligence . In addition to an insight into all relevant economic data, the tests also include a meticulous review of contracts with customers or employees. In addition to the respective specialists for the respective business, lawyers or tax consultants are also involved in the due diligence.

Overall, the interest in Wirecard is considered high. According to the Wirecard insolvency administrator Michael Jaffé, there are a total of over 100 interested parties. The talks on the sale of Wirecard's US business are the most advanced, Jaffé announced at the beginning of July. 

Wirecard North America put itself up for sale only shortly after the crashing bankruptcy of Wirecard AG at the end of June and involved the US investment bank Moelis & Company  . In a statement, the Americans had emphasized their economic independence from the parent company. It was said to be a "self-sustaining unit that was largely autonomous from Wirecard".

Wirecard bankruptcy: One of the biggest fraud scandals in German post-war history

Wirecard filed for bankruptcy at the Munich District Court at the end of June, after 1.9 billion euros and thus around a quarter of the total assets had disappeared without a trace. The Munich public prosecutor's office is now investigating the case. In addition to the suspicion of unfaithfulness, incorrect presentation and market manipulation, there is now also the suspicion of commercial gang fraud . Former CEO Markus Braun is now back in custody after a first arrest warrant against payment of a bail of five million euros was suspended at the end of June. A former CFO and the former chief accountant have also been arrested.

Angela Merkel apparently spoke to the then #Wirecard consultant Karl-Theodor zu Guttenberg about the scandal group's expansion in China last year. The Chancellery promised its help. https://t.co/NhBvuV3Rs9

The crashing crash of the Dax group is making waves. Especially the auditor EY(formerly: Ernst & Young) and the financial services regulator BaFin have come under fire. It was only on Thursday that the capital market law firm Tilp filed a lawsuit against the financial supervisors with the Frankfurt Regional Court. So far, investors have submitted claims for damages totaling around 6.5 billion euros to the law firm for review. The federal government is now in need of an explanation. The Bundestag Finance Committee holds a special session. In view of an unprecedented slump in prices and billions in damage to banks and investors, the case is now one of the largest fraud scandals in post-war German history.

List of rubric lists: © dpa / Peter Kneffel