Security & Fraud

Philippines Central Bank Says Wirecard Deposits Never Made

The Philippines central bank cast doubt on Wirecard AG’s assertion that the Munich, Germany payment processor deposited 1.9 billion euros ($2.1 billion) into two banks in the island nation.

Despite Wirecard’s claim to have directed the cash to BDO Unibank Inc. and the Bank of the Philippine Islands, the Bangko Sentral ng Pilipinas said Sunday (June 21) the money never entered the country, Reuters reported.

While the regulatory agency is still investigating, Central bank Governor Benjamin Diokno said the Southeast Asian country’s two biggest lenders have said 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,” Diokno said in a statement.

Both lenders have 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 another setback for Wirecard, whose executives on Friday still hoped it might be possible to recover the money, the Financial Times reported.

“Everyone in the company is adamant that the money exists,” a person briefed on the matter told the Times.

Wirecard declined to comment.

On Friday (June 19), PYMNTS reported Wirecard’s founder and CEO Markus Braun resigned after auditors revealed the money was missing from escrow accounts at two Asian banks. Wirecard said the decision was made in collaboration with the company’s supervisory board.

Ernst & Young, the auditor, said it became suspicious of letters confirming the existence of the accounts and the amounts held in the two banks.

“The document claiming the existence of a Wirecard account with BDO is a falsified document and carries forged signatures of bank officers,” a spokesperson for BDO Unibank Inc. said.

In a statement, Wirecard said Ernst & Young told the firm that no sufficient audit evidence could be obtained to confirm that the money exists.

“There are indications that spurious balance confirmations had been provided from the side of the trustee respectively of the trustee’s account holding banks to the auditor in order to deceive the auditor and create a wrong perception of the existence of such cash balances or the holding of the accounts for the benefit of Wirecard group companies,” the company said.

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