Business

Wirecard chair’s house and office raided by German police

German police have raided the home and office of former Wirecard chair Wulf Matthias, as the criminal investigation into one of Europe’s biggest cases of accounting fraud widens.

Officers searched the 76-year-old’s office in Frankfurt and his home in a suburb of Germany’s financial hub on Tuesday.

Munich police suspect that Matthias might have aided embezzlement by Wirecard’s management, according to people familiar with the investigation. It is unclear if prosecutors are also investigating other former supervisory board members.

The disgraced payments company was once hailed as a rare German technology success story. It disintegrated within a week last summer after discovering a €1.9bn cash hole in its balance sheet.

Matthias, a former senior banker at Credit Suisse in Germany and other lenders, was Wirecard’s chair for more than a decade from 2008. While he resigned as chair in early 2020, he stayed as a board member until the company’s collapse.

He was also chair of Wirecard Bank, a subsidiary of the Munich-based payments group.

Matthias oversaw the rise of Wirecard from a tiny payments firm into a stock market giant that at its peak was worth more than €24bn and replaced Commerzbank in Germany’s blue-chip Dax index.

However, business accounting for half of the company’s revenues and all of its profits was fictitious.

Three former Wirecard managers including former chief executive Markus Braun, who denies any wrongdoing, have been in police custody since last summer.

Munich prosecutors confirmed the raids but declined to comment further. Holger Matt, a Frankfurt-based lawyer for Matthias, declined to comment.

Matthias was summoned twice as a witness by the German parliament’s inquiry committee into the scandal but excused himself on health grounds.

After the Financial Times in October 2019 published documents that pointed to a concerted effort to fraudulently inflate sales and profits at Wirecard, Matthias dismissed calls for an independent audit.

In an interview with the FT, he called the public discussion about Wirecard’s potential accounting issues “an annoyance” and defended the work of the company’s auditor EY. “We have endless stories [about Wirecard], three a day. I have not looked at them in further detail. We have other things to do,” he said, just days before Wirecard mandated Big Four firm KPMG with an independent audit into the allegations that ushered in Wirecard’s demise.

Matthias resigned as Wirecard’s chair in January 2020 and was succeeded by former Deutsche Börse finance director Thomas Eichelmann, who had joined the board in mid-2019.

When he resigned as chair, Matthias said that it was “a special honour for me to accompany this extraordinary company and its management team over the past 11 years”, claiming that Wirecard achieved “a growth and success story unparalleled in Germany’s recent economic history” and was an “internationally operating blue-chip company”.


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