Singaporean director faces more charges related to Wirecard case

Citadelle reportedly handled money for Wirecard in a trustee capacity, although it was not licensed to do so in Singapore. PHOTO: REUTERS

SINGAPORE (BLOOMBERG) - Singapore authorities have added two additional charges against the director of a local accounting firm in relation to the case tied to disgraced German payments company Wirecard.

R. Shanmugaratnam, a director of Citadelle Corporate Services Pte, was charged with "wilfully and with intent to defraud", falsifying letters to Wirecard UK & Ireland, and Cardsystems Middle East FZ LLC, that the Singapore firm held tens of millions in euros in escrow accounts, according to charge sheets filed on Wednesday (Aug 19) and seen by Bloomberg News.

The accusations follow four similar charges against the 54-year-old Singaporean, the first person to be indicted in the city-state over the spectacular collapse of Wirecard, which has reverberated across the world.

The first of this week's two charges says that in May 2016, Shanmugaratnam falsely stated that there was a balance of €41.5 million (S$67.3 million) held by Citadelle in an escrow account on March 31, 2016. The other charge says that the same month, he misrepresented that there was €30.4 million held by Citadelle in another escrow account.

Shanmugaratnam's lawyer, N. Sreenivasan, didn't immediately reply to a message seeking comment.

Singapore is home to Wirecard's Asia-Pacific headquarters and the company has been expanding aggressively in the region.

In June, Singapore financial regulators said they are working with the local police to scrutinise aspects of the Wirecard case. Last year, Singapore police raided Wirecard's local offices after an employee in the city-state alleged that a member of the company's finance team engaged in accounting breaches.

Widening scandal

The Wirecard scandal has continued to widen and now threatens to engulf top politicians, regulators and auditors in Germany. Former Wirecard chief executive officer Markus Braun was re-arrested in July as German prosecutors said the company knew about massive losses as early as 2015.

Munich prosecutors last month arrested Oliver Bellenhaus, the managing director of Cardsystems Middle East, the fintech company's Dubai-based unit, according to a person familiar with the issue. Bellenhaus headed that unit, which has been dissolved.

In Germany, Delivery Hero will replace Wirecard in the prestigious DAX benchmark on Monday, it was announced on Thursday.

Following an index rule change in response to Wirecard's collapse in June, the food delivery start-up will take its place in the 30-member gauge ahead of the next quarterly review due Sept. 3. The change, implemented by DAX owner Deutsche Boerse, allows for insolvent companies to be removed from its indexes with two trading days notice.

Delivery Hero's addition may spark some controversy as the company is yet to achieve a single profitable year, raising questions about the prudence of including it alongside established heavyweights such as Siemens and SAP.

Berlin-based Delivery Hero only went public about three years ago. Its stock has gained almost 50 per cent since January, as virus-induced lockdowns boosted demand for food delivery in its key markets. Joining the DAX could further propel the stock as tracker funds are forced to increase their weightings.

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