Wirecard stocks jump after corruption charges are cleared
March 26, 2019
On Tuesday, Wirecard CEO Markus Braun announced that an independent investigation of the Munich-based financial technology firm has found accusations of manipulation to be false.
The news sent Wirecard stock, which is among the most volatile on Germany's DAX stock exchange, up by more than 30 percent.
The company had been under fire for weeks after the Financial Times (FT) newspaper ran a series of articles outlining what it said was a scheme to inflate profits by shuffling payments through a number of Wirecard offices in Asia. The accusations led to the company's Singapore offices being raided by police on February 8.The raids, in turn, led to a massive drop in Wirecard's stock value.
No 'criminal liability'
An independent investigation, carried out by the Singapore-based law firm Rajah & Tann, found irregularities on Wirecard's books, yet these were said to be minor, having no effect on the company's annual financial report.
The law firm discovered a falsely booked profit of €2.5 million ($2.82 million) which is to be corrected in Wirecard's 2018 annual financial statement, as well as a €3 million asset that was booked to the wrong balance sheet for one week in 2018.
Although the company itself was found to have no "criminal liability" for corrupt business practices such as the "round tripping" scheme outlined in the FT reports, a number of employees at Wirecard's Singapore offices may, nevertheless, be charged with crimes related to the accounting irregularities.
Tuesday's rally was welcome news for Wirecard, which had lost some €9 billion in value since rumors of accounting impropriety at the company began swirling on January 1.
js/jm (AFP, dpa, Reuters)