The former CEO of Wirecard, Markus Braun, has been arrested in relation to the ongoing €3.2 billion fraud investigation levelled against the firm, along with the company’s former CFO and former head of accounting.
Munich Public Prosecutor Anne Leiding said on Wednesday that the accused allegedly knew about financial irregularities at Wirecard as early as late 2015, but continued to defraud investors and banks by falsifying the company’s financial records, by inflating sales and total assets.
A new arrest warrant was issued for Braun on Monday, following his previous arrest and release in June, while his former CFO and head of accounting were taken into custody on Wednesday.
One board member, Jan Marsalek, is believed to be on the run, while another was taken into custody in early July.
Existing charges against Braun and his co-conspirators – including fraud, market manipulation, and falsification of financial records – may be “expanded considerably” in light of witness statements and additional documentary evidence, the public prosecutor’s office said on Wednesday.
Braun et al are accused of attempting to “inflate Wirecard AG’s total assets and sales volume by falsifying revenue” in order to lure more investors and garner more bank credit. The company was repeatedly kept afloat through loans issued under false pretences, despite Wirecard continuously making losses.
Both investors and banks in Germany, Japan and elsewhere were misled by falsified financial statements to the combined tune of €3.2 billion, all of which was “most likely lost,” prosecutors said.
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