Singapore police probing German e-payment firm

The Financial Times last week published two reports about alleged wrongdoing at Wirecard's Singapore office, sending shares in the member of the blue-chip DAX tumbling.
The Financial Times last week published two reports about alleged wrongdoing at Wirecard's Singapore office, sending shares in the member of the blue-chip DAX tumbling.PHOTO: REUTERS

Move comes after media reports about alleged fraud and forgery involving Wirecard office here

Singapore police are looking into matters related to German digital payment firm Wirecard, whose shares have crashed amid allegations of executive forgery and fraud involving its Singapore office.

A spokesman for the Singapore Police Force said this yesterday in response to media queries.

Its Commercial Affairs Department carries out investigations on financial crimes such as money laundering.

The move comes after the Financial Times last week published two reports about alleged wrongdoing at Wirecard's Singapore office, sending shares in the member of the blue-chip DAX tumbling.

Wirecard's 25 per cent plunge was the worst since July 2008 and capped a tumultuous three days that shaved about €7.2 billion (S$11 billion) off its market value.

Last Friday, the Financial Times reported that an external law firm commissioned by Wirecard found evidence indicating "serious offences of forgery and/or of falsification of accounts".

Rajah & Tann lawyers identified potential civil and criminal violations in Singapore, Hong Kong, India, Malaysia and Germany, findings that formed the basis of a presentation to Wirecard's senior management on May 8 last year, the newspaper said.

Wirecard denied the story, a point it reiterated yesterday, saying that an external law firm it brought in to investigate actions by a member of its finance team in Singapore made no conclusive findings of criminal misconduct by any employee of the company.

Last Friday, the Financial Times reported that an external law firm commissioned by Wirecard found evidence indicating "serious offences of forgery and/or of falsification of accounts".

Wirecard said that in April last year, a Singapore team member raised concerns about the alleged actions of a finance team member in Singapore. It then started an investigation, which found no evidence to support the allegations.

"Furthermore, there were indications that the allegations could be related to personal animosity between the employees involved," the company said.

Nonetheless, Wirecard hired Rajah & Tann for a review, which is about to be completed, but has so far not brought up findings of criminal misconduct, the company said.

Rajah & Tannhad separately said it is unable to comment about the company. "Regrettably, we cannot respond to your queries at the moment due to sensitivities," a spokesman for the Singapore law firm said over the weekend in response to Bloomberg.

Meanwhile, German financial regulator BaFin is looking into the allegations for signs of possible market manipulation. Last Friday, BaFin spokesman Anja Schuchardt said the regulator is at the beginning of its investigation and will take the new report into account.

Founded in 1999, Wirecard initially provided financial services to online gambling and adult websites, barely surviving the dot.com bust. After a decade of growth, the company last year replaced Commerzbank in Germany's benchmark DAX index. Hailed as a champion of the fintech scene, it then boasted a market valuation of more than €23 billion.

It is not the first time Wirecard has had to defend its reputation.

Its shares plunged after past claims were published about accounting irregularities in 2008 and fraud allegations in 2016.

But analysts have stayed true to the company, with 79 per cent recommending investors buy the stock, according to data compiled by Bloomberg.

 
A version of this article appeared in the print edition of The Straits Times on February 05, 2019, with the headline 'Singapore police probing German e-payment firm'. Print Edition | Subscribe