German lawmakers to quiz ex-Wirecard boss on Berlin’s role

According to Reuters, German lawmakers to quiz ex-Wirecard boss on Berlin’s role.

BERLIN / FRANKFURT (Reuters) – German lawmakers will question the former boss of bankrupt payment company Wirecard on Thursday about his contacts with the government as they investigate Berlin’s role in the biggest corporate fraud in post-war Germany.

Their investigation into the implosion of a German tech star once worth $ 28 billion, owed by billions, is increasing pressure on German Chancellor Angela Merkel and Finance Minister Olaf Scholz ahead of next year’s national elections.

Wirecard’s demise has embarrassed the German government, which boasts a reputation for righteousness and reliability, amid criticism that the authorities ignored red flags.

Munich prosecutors have charged Wirecard’s former CEO Markus Braun with fraud and embezzlement, claiming that he had hidden the true state of his finances from investors.

Braun, who has denied any wrongdoing and has said Wirecard was the victim of a wider fraud, is in prison awaiting trial. His lawyer did not respond to a request for comment on Thursday.

“Investigators see Braun as the ‘Godfather’ in the Wirecard fraud,” Fabio De Masi, one of the lawmakers, told Reuters. ‘Who helped him? We want to know what happened. “

The police are looking for another former top manager of Wirecard, Jan Marsalek.

Lawmakers told Reuters they will ask Braun about his contact with German officials and, in particular, about a meeting he had in November 2019 with Deputy Finance Minister Joerg Kukies.

The German authorities have rejected any suggestion of undue government influence involving Wirecard.

Asked on Thursday by Reuters about Braun’s meeting with Kukies in late 2019, the Treasury Department referred to an earlier statement that the talks covered topics such as allegations of market manipulation, as well as, more broadly, cryptocurrencies and payment companies’ business model.

Florian Toncar, a liberal party legislator who will question Braun, told Reuters he wanted to learn more about Wirecard’s lobbying with the government and regulators.

“We want to know … what politicians and authorities he was in contact with and what they were talking about,” Danyal Bayaz, a key Green Party lawmaker involved in the investigation, told Reuters.

Scholz, who heads Germany’s Ministry of Finance and is responsible for the regulator BaFin, has also been criticized for failing to hold Wirecard to account and instead investigating the company’s critics for years.

Scholz has since committed to tightening up financial controls to prevent repeated fraud.

The Wirecard affair has also reached the German Chancellery.

The government has said Merkel brought up Wirecard’s planned acquisition of a company in China during a visit there in September 2019 and that a senior official in her office has subsequently pledged further support to Wirecard.

In an official parliamentary response, it said Merkel was currently unaware of the irregularities at Wirecard, which was dismantled after the disclosure of a € 1.9 billion hole in his accounts led to his insolvency in June.

Prosecutors have also been criticized for not noticing the problems at Wirecard, but instead reporters at the Financial Times, who first published allegations related to its accounting.

Additional reporting by Joern Poltz; Written by John O’Donnell; Editing by Alexander Smith

© Thomson Reuters

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