ZCZC
BCN-10
GERMANY-FRAUD-MARKET
Wirecard shares plunge on new fraud report
FRANKFURT AM MAIN, Feb 2, 2019 (BSS/AFP) – Shares in German payment
processing firm Wirecard plunged for the second time in a week Friday, after
a newspaper report added fuel to allegations of fraud in its Asian
operations.
Stock in the company, which knocked banking stalwart Commerzbank out of
the prestigious DAX blue-chip index last year, plummeted 21.87 percent to
trade at 113.05 euros ($129.54) by 4:55 pm in Frankfurt (1555 GMT).
The share had earlier plunged by as much as 30 percent.
The tumble came immediately after the Financial Times reported it had seen
documents from lawyers commissioned by Wirecard, showing they found evidence
of “serious offences of forgery and/or of falsification of
accounts/documents” at the group’s Singapore office.
“There are reasons to suspect that they may have been carried out to
conceal other misdeeds, such as cheating, criminal breach of trust,
corruption and/or money laundering,” the document seen by the FT continued.
Wirecard hit back at what it described as “yet another inaccurate,
misleading and defamatory” article.
After its shares crumbled following the earlier report, Wirecard on
Wednesday also issued a categorical denial of the FT’s original article on
suspected fraud at the company, which the paper said was based on a different
internal document.
And German financial markets watchdog Bafin said Thursday it was launching
an investigation into possible market manipulation over the story.
Wirecard stunned the traditional German banking sector last year by
displacing Commerzbank, which had enjoyed sizeable enough market
capitalisation and trading volumes to be listed on the DAX for decades.
Hailed as a champion of the insurgent “fintech” (financial technology)
scene with its software for cashless and contactless payments, it then
boasted a market valuation of more than 23 billion euros — outweighing even
giant Deutsche Bank.
But since January 1, the stock has shed 5.2 percent of its value, leaving
the firm’s capitalisation at 17.9 billion euros.
BSS/AFP/HR/0940