A former Wirecard (WDI:DE) executive who was based in Dubai but returned to Germany and was quickly arrested wants to cooperate with investigators according to multiple reports. The unnamed individual was previously CEO of Cardsystems Middle East an entity that reportedly generated the bulk of Wirecard’s profits according to Suddeutsch Zeitung.
Reuters quotes the former executive’s defense attorney Nicolas Fruehsorger stating:
“My client has voluntarily given himself up for the proceedings and – in contrast to others – takes individual responsibility.”
The cooperation may be a significant breakthrough in better understand the collapse of the once prominent Fintech.
Last month it emerged that Wirecard had misplaced €1.9 billion. Soon, CEO Markus Braun resigned and was arrested. The COO, Jan Marsalek is now on the run and an arrest warrant has been issued. The Fintech then filed for insolvency.
Shares in Wirecard have collapsed from over €100 a share to under €2 a share representing a spectacular destruction of value. Wirecard is currently a member of the German DAX. As it is in bankruptcy proceedings Wirecard may be removed from the prominent index as soon as next month.
Braun is also under investigation for insider trading as volume jumped just prior to the bankruptcy filing – something Braun’s lawyer has denied.
Meanwhile, pressure on German Finance Minister Olaf Scholz is rising as individuals question his handling of the scandal. Suddeutscher reports that Scholz was aware of allegations of “manipulation” in February 2019, yet he appears to have not given the necessary attention to rumblings of Wirecard’s shortcomings.