Security & Fraud

Wirecard Reopens UK Banking As Regulators Remove Restrictions

Wirecard

Wirecard AG got the green light Tuesday (June 30) to resume its banking operations in the United Kingdom (UK), as financial regulators lifted restrictions that had been placed on the troubled German payments company four days ago.

The Financial Conduct Authority (FCA), the London-based agency that regulates the U.K.’s financial services industry, provided its consent for Wirecard Card Solutions to reopen. As of midnight, June 30, the payments company can resume electronic money and payment services to its customers, according to a statement on its website.

“The primary objective of these requirements was to protect the electronic money funds of consumers in safeguarded accounts,” the FCA said. “It also had the effect of preventing consumers from withdrawing and making payments with those funds.”

For Wirecard customers, the FCA’s ruling means the company can resume electronic money and payment services to its customers who can now use their cards as usual.

It’s not clear when customers can access their cash.

“There may be a delay before all card programmes are fully operational, so some customers could find themselves unable to transact immediately but we anticipate this lasting no longer than 24 hours,” Wirecard Card Solutions said in a statement on its website. “We apologize for the inconvenience to our valued customers that the temporary suspension caused.”

Last Friday, the FCA ordered Wirecard’s U.K. subsidiary, Wirecard Card Solutions, to freeze funds and assets as regulators determined the next steps. As a result of the ruling customers did not have access to their accounts.

On Monday, the FCA reiterated while Wirecard AG was correcting issues raised by the $2.1 billion accounting scandal that has caused turmoil for the once popular payments company, restrictions on the German payments company would remain in place.

The FCA’s most recent action does not make Wirecard’s troubles disappear. Investigators in Munich, the European Union, Singapore and the Philippines have said they are conducting investigations into $2.1 billion of supposed deposits missing from two banks in the Philippines.

Wirecard AG filed for insolvency last week in Munich following an auditor’s disclosure of the missing funds.

Its founder and CEO Markus Braun, 51, resigned and was arrested on charges of misrepresenting Wirecard’s accounts and market manipulation. He has since been released on 5 million euros ($5.6 million) bail.

Wirecard has said it would continue to operate as the court considers the company’s insolvency request.

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