Wirecard AG, the Munich, Germany payment processor, acknowledged Monday it’s likely the missing 1.9 billion euros ($2.1 billion) from its accounts in the Philippines never existed, Reuters reported.
“The Management Board of Wirecard assesses on the basis of further examination that there is a prevailing likelihood that the bank trust account balances in the amount of 1.9 billion euro do not exist,” the company said in a statement.
As a result, the German payments firm said it will withdraw its 2019 and first quarter 2020 financial results.
In addition, Wirecard said it will consider cost reductions, a restructure and ending some business divisions, the report said.
Monday’s acknowledgement caps weeks of uncertainty.
PYMNTS has chronicled the controversy.
Ernst & Young, the company’s auditor, said it became suspicious of letters confirming the existence of the accounts and the amounts held in the two banks.
“There is a prevailing likelihood that the bank trust account balances in the amount of 1.9 billion euros do not exist,” Wirecard said at the time.
Last week, Wirecard founder and CEO Markus Braun stepped down one day after the auditing team revealed the money was missing from the German payment processor’s accounts.
In a statement, the company said Braun “resigned today with immediate effect” and noted the decision was made “in mutual consent with the supervisory board.”
On Sunday (June 21) Wirecard’s claim to have directed the cash to BDO Unibank Inc. and the Bank of the Philippine Islands, was challenged by the Philippines central bank. The Bangko Sentral ng Pilipinas said the money never entered the country.
The regulatory agency concluded the documents showing Wirecard deposited the funds were fakes.
“The international financial scandal used the names of two of the country’s biggest banks, BDO Unibank Inc. and the Bank of the Philippine Islands, in an attempt to cover the perpetrators’ track,” Central bank Governor Benjamin Diokno said in a statement.
Each of the lenders has told the central bank that Wirecard was not a client and never did business with them, the news service reported.
The governor’s statement is the latest setback for Wirecard, whose executives on Friday still hoped it might be possible to recover the money.