The former CEO of German payment service provider Wirecard has been arrested in an accounting scandal, according to prosecutors in Munich.
Markus Braun’s arrest came on Tuesday, following his resignation on Friday after the company disclosed that auditors could not find accounts containing the 1.9 billion euros ($2.1bn) and postponed its annual report.
On Monday, Wirecard said its management board “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 euros do not exist”.
Hours later, it announced the firing of its chief operating officer, Jan Marsalek, who had been suspended from the management board last week.
Germany’s DPA news agency reported that Marsalek had been in charge of overseeing daily operations, including in Southeast Asia, where the possible fraud occurred.
Two Philippine banks that were said to hold the money in escrow accounts said they had had no dealings with Wirecard.
The Bank of the Philippine Islands said a document claiming the company was a client was “spurious”.
BDO Unibank said that a document claiming the existence of a Wirecard account was falsified and “carries forged signatures of bank officers”.
The country’s central bank governor said none of the missing money entered the Philippines’ financial system.
Wirecard AG was once regarded as a star of the growing financial technology sector, but its shares have fallen sharply after the company became the subject of multiple Financial Times reports about accounting irregularities in its Asian operations.
Wirecard disputed the reports, which started in February 2019, and said it was the victim of speculators.