Update on the Wirecard Scandal in Germany

I discussed this in a post in July 2020.

Wirecard, founded in Germany in the 1990s, pioneered the use of a virtual prepaid card for online purchases.

In 2009, while the world was reeling from the global financial crisis, Wirecard introduced a fraud prevention suite to help protect its card customers against con artists. In retrospect it looks ominous that this was the catalyst of a great burst of growth.

Wirecard was soon a great success. A European Paypal. By the end of 2016 it was operating in Singapore, New Zealand, Australia, South Africa, Turkey, and in 2016 it entered the United States.

When I last posted on the subject here, though, the virtual feces had just hit the fan. The Financial Times had done a series of investigative pieces about its funny accounting practices. Then, in late April 2020, the auditor announced it could not sign off on the books. Company shares fell 26% in a day.

On June 5, the police searched Wirecard's headquarters in Munich. Less than two weeks later, the company acknowledged that close to two billion euros were "missing."

The CEO, Markus Braun, resigned the following day and disappeared.

In time, Braun was found and arrested. This brings us back to December 2022 because Braun and some of his associates are now on trial. They are charged with defrauding investors of $3.7 billion over a five year period leading up to that June 2020 disappearance. His attorneys say the prosecution has "assumed a false picture of the facts."

Braun is the central figure of the three of the three heads you see above.

We'll be watching. The trial could take a year.

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