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Wirecard UK given green light to continue trading in United Kingdom

By Elizabeth Hearst

The Financial Conduct Authority (FCA) has allowed Wirecard to resume operations in the United Kingdom. 

Following on from the German payment firm’s insolvency, customers in the United Kingdom could not access their accounts and make payments. 

“We have been working closely with Wirecard UK and other authorities over the last few days to ensure that the firm was able to meet certain conditions required to lift the restrictions we imposed. We are now in a position to allow Wirecard to resume operational activity,” The FCA said. 

The FCA imposed restrictions on Wirecard after the company disclosed a €1.9 billion euro hole in its accounts, and subsequently filed for insolvency. 

Markus Braun, former CEO of Wirecard has been arrested and accused of inflating the company’s finances. 

Auditors of Wirecard – EY, have told its partners to prepare for “difficult conversations” with their clients, about their audits of the company. In an internal note sent to senior partners, EY advised their partners to tell their clients that the “objective” of Wirecard’s fraud was to “deceive investors and EY”.

It has emerged that EY failed for three years to request critical information from a Singapore bank, in which Wirecard stated it had up to €1bn in cash. 

EY also informed board members that €1.9bn held in the Philippines “probably did not exist”. This was uncovered after special auditors KPMG were brought in last year to investigate allegations of misconduct by the Financial Times, and could not verify significant account balances. 

Wirecard’s new CEO – James Freis, who only joined Wirecard last month, has told board members that basic checks should have been enough to uncover this scandal. 

The company announced that it would continue operating, despite filing for insolvency, but it had suspended June salaries to employees in Germany, France, Luxembourg. However the majority of 5400 staff employed by subsidiaries have received their June salary. 

Information sourced:

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