MUNICH (BLOOMBERG) - German online payments firm Wirecard AG has seen its stock plunge by more than a third in recent days on reports of accounting misdeeds at its Singapore unit. Now, the company is fighting back by questioning the foundations of the allegations.

A preliminary review last May by a respected Singapore law firm lists allegations of potential financial irregularities, money laundering, and forgery at Wirecard's Asian unit. But the German company says the report is based on evidence that is either faulty or forged.

A deeper investigation by the law firm so far hasn't "found any evidence of criminal misconduct", Wirecard chief executive officer Markus Braun said by phone on Friday (Feb 8) from the company's headquarters near Munich.

"This whole issue will be resolved quickly."

Yet investors got another red flag on Friday when Singapore police raided Wirecard's offices there, ratcheting up concerns over its accounting practices.

A spokesman said the company had "provided the police with comprehensive supporting material in regards to their inquiry".

The 31-page initial investigation that the Rajah & Tann law firm completed in May is largely based on the accounts of a person the lawyers call "Bobby".

The document describes allegations of criminal activity ranging from backdating agreements to forged invoices.

Rajah & Tann declined to comment. Wirecard says the report is authentic, but that the findings relied on documents of suspicious provenance, possibly intended to damage Wirecard or profit from short-sales as its stock has lost some €9 billion (S$13.8 billion) in value since the Financial Times first published the allegations on Jan 30.

"We think this was all done to put pressure on the share price," Braun said.

German prosecutors say they have launched a market manipulation probe in response to a criminal complaint Wirecard filed in the wake of the share drop. Officials haven't named any suspects and say they haven't found any reason to investigate Wirecard employees over accounting fraud allegations.

Wirecard says that after Rajah & Tann wrapped up the May report, it hired the firm to do a fuller investigation. Braun last week saw the original report for the first time, and he said that until then the entire affair had been handled by the company's internal compliance team, which by design doesn't include the CEO in order to avoid undue pressure from top management.

Braun said that a final report will be available in "a matter of weeks" and that he's confident it will clear the company and its employees of wrongdoing.

Rajah & Tann's preliminary investigation focused on three Wirecard employees in Singapore. There's evidence to suggest they "knowingly worked together to create and backdate agreements billed by Wirecard Singapore up to three years prior", the report said.

The documents cite actual companies, but the lawyers said they didn't include correspondence to back up a real commercial relationship.

"To date, we have not seen a single e-mail from any of the counter-parties which, given the nature and size of the deals, raises doubt as to the authenticity of the same," the lawyers wrote.

"There are strong reasons to believe that both the agreements and invoices may be fictitious."

The company says the preliminary report is based on evidence provided by the person identified as "Bobby", including the e-mails it cites.

Braun said the investigators preparing the report didn't have access to the company's servers to judge the authenticity of those e-mails. He pointed to a statement this week by Rajah & Tann that said in preparing its new report, the lawyers had "made no conclusive findings of criminal misconduct on the part of any officer or employee of the Company".

Wirecard got its start two decades ago processing payments for gambling and pornography websites, but has since morphed into a developer of software and systems for online payments and fraud protection used across the Internet.

Investors have seen it as a leader in financial technology, and its revenue almost doubled in the two years to 2018, to €2.1 billion, following acquisitions of at least 18 companies in recent years.

In September, it replaced Commerzbank AG in Germany's 30-company DAX stock index alongside titans such as Volkswagen AG, Siemens AG, and Deutsche Bank AG.

One section of the initial report from Rajah & Tann said Wirecard employees in Asia appeared to have backdated agreements worth €3 million with a Singapore industrial equipment maker called Flexi Flex, though the lawyers didn't say who might have benefited from those actions.

Wirecard has said there was never any money flowing between any of its units and companies mentioned in the report, which Braun said indicates the allegations are unfounded.

The whole affair reflects "false allegations against employees we strongly reject", Braun said. "We will follow up on that with all legal means."