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The Story of a Former Prisoner: Germany’s Role in the Wirecard Scandal Under the Microscope



In February 2019, after Wirecard’s share price fell sharply, German authorities launched a criminal investigation into short sellers and journalists accusing the company of defrauding and banning investors from gambling with the company.

The documents that Reuters saw for the first time showed that the only independent information ̵

1; in addition to Wirecard’s representation – was obtained by Munich prosecutors, which launched a criminal investigation, was a third-party account of the incident from the money launderers. Sentenced Daniel James Harris

The reasons leading up to the prosecutors ‘and regulators’ decisions to launch a criminal investigation and a ban on short sales, and whether they are too enthusiastic about supporting Wirecard, are the main concerns. It was investigated by a parliamentary inquiry into the collapse of Germany’s biggest post-war company. Fraud scandal

A criminal investigation and a short-selling ban was launched by the authorities after Wirecard complained that it was targeted by an unidentified speculator who said it was in the bluff with two Financial Times journalists and had prior knowledge of it. A negative report that says there is a fraudulent account.

In fact, some Wirecard executives were involved in a complicated global fraud at the time, the German government, prosecutors and regulators said last year after the payment company filed for bankruptcy with nearly 4 billion creditors. dollar

The stories Reuters saw included thousands of emails, messages, chats and memos by German authorities, set for a parliamentary inquiry that culminated in this week, with testimony from Prime Minister Angela Merkel on Friday.

The Harris testimony was prepared by Wirecard, with the company’s attorney sent a two-page written statement to prosecutors on February 14, 2019, according to the document.

In a statement, Harris identified himself as a stock trader in Essex in the south of England and said he met his broker, whom he did not identify on January 30, 2019, the date. Wirecard’s share price soared 22%.

The broker said he was informed investors were trading in anticipation of a negative FT report on the company, which was released later that afternoon, according to a Reuters statement.

“He told me he had talked to his friend,” Harris said. “My broker said this friend had told him the article was going to be published about Wirecard.”

In his statement, Harris said he was not operating with the data, however, Wirecard argued that market discussions about negative pre-publication articles were proof that investors were trading insider information and possibly collusion. Thinking to reporters at the time, FT denied this, characterizing Wirecard’s claim as “smokescreen”.

Reuters was unable to reach Harris or his lawyer for comment.

Harris was sentenced to two years in February 2017 for money laundering on a drug dealer who provided motorcycle delivery services in London and Essex, according to the UK’s National Crime Agency.

A spokeswoman for the Munich prosecutor said Harris’ statements confirmed Wirecard’s claims that speculators were unfairly targeted.

“The statement under oath was used by Wirecard’s legal representative to confirm legal complaints,” she added.

In February this year, state prosecutors told a congressional hearing he had not spoken to Harris without elaborating.

Munich prosecutors denied a reporter’s investigation last year, concluding that there was no evidence of collusion with investors, while no action was taken against Shore sellers. Many of the cases being investigated

‘So much concrete data’

The documents seen by Reuters include contacts of executives and officials from Wirecard, prosecutors and the BaFin financial regulator given to lawmakers.

The prosecutor’s office emailed Harris’ statement to BaFin on February 15, 2019, which is Friday, the documents show, and on the following Monday BaFin announced the first short-selling ban for a single stock in German history.

BaFin’s ban is a fairy tale watershed, according to lawmakers, tacitly assuring the company’s credibility while stopping suspicious investors.

A BaFin spokeswoman said Witness Harris’ statements had “no role” in the ban on short sales. But it is compatible with the app to manage the market.

But Sebastian Kimmer, a member of BaFin, who contacted Munich prosecutors, testified before lawmakers in February this year that Harris’ order gave “Very concrete information” that supports the Wirecard complaint.

Kimmer said the information from prosecutors was deemed serious and credible by regulators. He added that Harris’s statement, along with the allegations from Wirecard forwarded by prosecutors, had been forwarded to his superiors.

No details about Harris’ statements were made public.

Munich prosecutors previously defended their role, saying they acted objectively in alerting BaFin of Wirecard’s fears of being targeted by short sellers.

BaFin chairman Felix Hufeld but later resigned in the wake of the scandal, defended the short-selling ban to maintain confidence in the German stock market.

But three lawmakers at a congressional hearing said the actions of prosecutors and BaFin in February 2019 showed a readiness to go shoulder to shoulder with Wirecard against critics, despite what they identified as evidence that the fragile

Florian Toncar, one of the lawmakers, said Munich prosecutors showed it was likely to apply. “One-sided view on the Wirecard case”

“They carried a vague testimony without a signature … it’s a believable story,” he added.

Our Standard: The Thomson Reuters Trust Principle.


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