First a Missing $2.1B. Now the Former CEO Is Arrested

Markus Braun, who had led Wirecard since 2002, turned himself in
By Kate Seamons,  Newser Staff
Posted Jun 23, 2020 7:40 AM CDT
First a Missing $2.1B. Now the Former CEO Is Arrested
FILE - In this Thursday, April 25, 2019 file photo, Markus Braun, CEO of financial services company wirecard, attends the earnings press conference in Munich, Germany. Prosecutors in Germany say that the former CEO of the payments company Wirecard has been arrested in an accounting scandal that centers...   (AP Photo/Matthias Schrader, file)

(Newser) – Former Wirecard CEO Markus Braun was arrested in Germany after turning himself in late Monday, the same day the company he had led since 2002 said it was likely that a missing $2.1 billion never existed. Braun had resigned on Friday, and CNN reports that when resigning, he indicated the company may have fallen victim to a mammoth fraud. Munich prosecutors allege he had a hand in such a scheme. The AP reports an arrest warrant was issued shortly after the payment-processing company's Monday announcement. The Austrian was arrested on suspicion of having inflated the digital payment company's balance sheet and sales using fake transactions intended to make the company appear more robust and desirable to investors and customers. Prosecutors say others may have been in on it.

Though the Financial Times has been reporting on suspicious financial dealings at the company for 18 months, things began to unravel last week when the company said its auditor wouldn't sign off on Wirecard's financial results after being unable to find the money. The BBC reports the two Philippine banks that were said to be holding the money in escrow for the purposes of "risk management" then denied having anything to do with Wirecard and suggested documents had been forged; the country's central bank denied the money had ever entered the Philippines' financial system. The AP adds that Wirecard COO Jan Marsalek was fired on Monday; the oversight of daily operations in the Southeast Asia region fell under Marsalek's purview. The company's market value has fallen from $26.9 billion in September 2018 to $1.9 billion as of yesterday. (Read more on the fallen German tech star here.)

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