Wirecard shares plummeted more than 66% on Thursday morning after the German payments group said its auditor had found a âŹ1.9bn (ÂŁ1.71bn) black hole in its accounts.
The fintech firm said there were indications a Wirecard a trustee had tried to âdeceive the auditor and create a wrong perception of the existence of cash balancesâ through various bank accounts.
The group said in a realease: âThere are indications that spurious balance confirmations had been provided from the side of the trustee respectively of the trusteeâs account holding banks to the auditor in order to deceive the auditor and create a wrong perception of the existence of such cash balances or the holding of the accounts for to the benefit of Wirecard group companiesâ.
Wirecard (WDI) shares made some gains and were 45% down later on Thursday afternoon, with the stock trading at around âŹ53.9, down from yesterdayâs closing price of âŹ103.30 per share.
Wirecardâs chief executive Markus Braun (pictured) added: âIt is currently unclear whether fraudulent transactions to the detriment of Wirecard AG have occurred. Wirecard AG will file a complaint against unknown personsâ.
If the company fails to provide audited financial reports, conducted by Ernst & Young, by Friday it could face the termination of around âŹ2bn in corporate bank loans, a move that could lead to an immediate default or even bankruptcy.
Investors are already calling for an in-depth revision of the companyâs leadership amid the scandal, especially since Wirecard had already been under suspicion of potential fraud and false accounting after a report from KPMG was released last month saying that the firm was unable to verify roughly âŹ1bn in revenues recorded on its books.
The Aschheim-based digital payments processor is also the subject of a long-running investigation into potential market manipulation from Germanâs financial watchdog, Bafin, based on allegations of collusion with short sellers to manipulate the price of the companyâs shares.
Here is a link to the companyâs full press release on the matter: Wirecardâs press release.
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