Security & Fraud

Wirecard Exec Admits Role In German Company's Collapse, Attorney Says

One of the unnamed jailed executives in the Wirecard scandal has reportedly admitted guilt to the multi-billion-dollar fraud and money laundering case, according to Reuters.

The executive was the CEO of CardSystems Middle East, the largest unit under Wirecard's command.

Nicolas Fruehsorger, a defense lawyer for the executive, said his client "has voluntarily given himself up for the proceedings and — in contrast to others — takes individual responsibility,” according to Reuters. The executive traveled from Dubai to turn himself in last week but was not named to avoid prejudice in how the case is judged later.

The subject was arrested on suspicion of conspiracy to commit fraud, attempted fraud and aiding and abetting other crimes, according to Reuters.

The confession is the first reported in the scandal, which has been unfolding for the past month as it was revealed that the once-beloved payment company was allegedly cooking its books and had millions of dollars missing from its reports.

The company filed for insolvency in June after being indebted to creditors for 4 billion euros ($4.6 billion). As the scope of the scandal unfolded, those investigating it said it had been a purposeful scam that involved various subjects all over the world.

Some of the partnerships the company made with other institutions, PYMNTS reported, could have been hoaxes or not as important as Wirecard claimed. For instance, Wirecard put out a press release announcing a partnership with SAP, which the latter company had not signed, nor had it approved any press release going out for announcement.

In 2019, the company put out over 100 news releases, with many companies named not responding to journalists' request for comment or saying the relationship had been overstated by Wirecard.

Numerous arrests have been made already, including those of CEO Markus Braun and Oliver Bellenhaus, who ran the CardSystems Middle East division that a large amount of the scandal is based around.

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