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Cover-up allegation: Special auditor criticizes Wirecard's lack of cooperation - "encountered significant hurdles"

2020-11-27T17:30:54.857Z

The special auditor from KPMG at the former Dax group Wirecard indirectly accused the company of covering up before the Bundestag investigative committee.



The special auditor from KPMG at the former Dax group Wirecard indirectly accused the company of covering up before the Bundestag investigative committee.

  • The

    Wirecard scandal

    severely shook the confidence of many investors in German financial regulators and auditors.

  • For years,

    EY

    had

    dutifully

    audited the payment service provider's financial statements.

  • During a special audit,

    KPMG

    found indications early on that something was wrong in Aschheim near Munich.

    EY nevertheless refuses to testify.

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Berlin - The auditor who was responsible for the special audit on balance sheet fraud at the former

Dax

* company

Wirecard

* has made clear allegations against

Wirecard

.

"In the course of the investigation, we encountered significant hurdles and obstacles which were due to the lack of willingness to cooperate on the part of

Wirecard

," said

Alexander Geschonneck

from the auditing company

KPMG

on Thursday in

the Bundestag

investigation committee

.

Some documents were made available several months late, interview dates were postponed and access to IT systems was not made possible.

The result was nevertheless clear:

Wirecard

did not provide sufficient evidence of the existence of customer relationships and the revenues allegedly generated from them

for business with third parties in Asia

.

These deals are said to have made up

more than half of

Wirecard's

sales and a large part of profit.

However, Geschonneck reported that there was insufficient evidence of the amount of sales, account balances or incoming payments.

Wirecard: KPMG special audit really got the scandal rolling

The auditing company KPMG was

commissioned

with the

special audit

in October 2019

after several reports of irregularities at the tech group.

Your investigation report really got the scandal rolling.

In the summer, the now insolvent Dax group then admitted air bookings of 1.9 billion euros.

Fabio De Masi, an MP for the leftwing Die Linke party, urged the German government to “act immediately” and to stop commissioning EY with taxpayer-funded mandates until potential criminal misconduct by the firm has been ruled out.

- Fabio De Masi (Member of the Bundestag) (@FabioDeMasi) November 26, 2020

The company, once traded as a German technology hope, made losses for years according to the current state of the investigation.

The Munich

public prosecutor's office

assumes that fictitious profits have been reported since 2015.

According to their calculations, banks and investors alone lost more than three billion euros.

In total, the

creditors have registered

claims of more than 12.4 billion euros.

According to information from Merkur.de *,

Wirecard

insolvency administrator

Michael Jaffé

has

generated

around 500 million euros from the sale of

parts

of the company or the technology platform.

This should leave the creditors with the greatest part of their demands.

Wirecard: Auditor EY wants to avoid giving a statement

The longstanding

Wirecard

auditor

EY

, however, continues to remain silent.

You will make use of your right to refuse to testify, said EY.

The reason given was that one was not released from the obligation to maintain confidentiality.

In Berlin, however, this view causes bewilderment.

(dpa / utz)

* Merkur.de is part of the nationwide Ippen Digital editorial network.

Source: merkur

All news articles on 2020-11-27

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