The Wirecard collapse
Aschheim, near Munich, Germany, 2020
This case is a work of fiction. The characters, names, places and events in the game do not portray real people. The account below is a factual summary, based on public sources, of the case that served as inspiration.
Wirecard, a German electronic payments company based in Aschheim, on the outskirts of Munich, grew so fast that in 2018 it joined the DAX, the index of the 30 largest companies on the German stock exchange. Much of its profit came from third-party partners in Asia and the Middle East, who processed payments on its behalf. From 2019, a series of reports by the British newspaper the Financial Times pointed to accounting irregularities in those businesses. The company denied everything, and the German financial regulator even banned bets against the shares for two months and filed complaints against journalists with prosecutors.
In June 2020, the auditor EY refused to sign the 2019 accounts because it could not confirm 1.9 billion euros that the company said it held in trust accounts at two banks in the Philippines, about a quarter of the balance sheet. The two banks, BDO and BPI, stated that Wirecard was not a customer and that the documents presented were forged, with falsified signatures of employees; the Philippine central bank said the money never entered the country. Days later, the company itself admitted the money probably never existed, and on 25 June it filed for insolvency.
Sources
- aljazeera.com/amp/economy/2020/6/23/germany-arrests-ex-ceo-of-wirecard-over-missing-2-1bn
- abs-cbn.com/business/06/19/20/wirecard-slumps-40-percent-as-search-for-missing-billions-turns-to-philippines
- bellingcat.com/news/uk-and-europe/2020/07/18/worlds-most-wanted-man-jan-marsalek-located-in-belarus-data-points-to-russian-intel-links/
- accountingtoday.com/articles/as-wirecard-collapsed-key-player-fled-by-private-jet-to-belarus
In the game
Phantom Balance
Lumexa AG headquarters, on the outskirts of Munich, a Thursday in June, 6:30 a.m. The most celebrated payments company on the German stock exchange publishes its annual accounts at 10.
The company's chief executive, Markus Braun, resigned and was arrested in Munich, accused of accounting fraud and market manipulation; his trial began in December 2022. The chief operating officer, Jan Marsalek, responsible for the Asian business, was dismissed and, according to Austrian prosecutors and the investigative site Bellingcat, left on a private jet from a small airfield near Vienna bound for Minsk, in Belarus, on 19 June. He was never found and became one of the most wanted men in Europe.
